Insurers enhance risk engines to meet Solvency II demands

The requirements of new regulations such as Solvency II are forcing insurers to update their risk technology infrastructure. Clive Davidson looks at how insurers are adjusting their risk engines in response to these demands and the challenges they face

Risk engines, together with economic scenario generators and actuarial modelling systems, are major technological building blocks for Solvency II compliance, especially for those companies planning to use an internal capital model. Risk engines aggregate information from multiple sources and calculate exposures and capital requirements for management and regulatory reporting. In essence, they are data processors, and therefore the infrastructure around them, particularly the data management, is