Solvency II
WHAT IS THIS? Europe’s Solvency II directive came into effect in 2016, putting risk at the heart of a harmonised prudential framework for insurance firms. Similar in outline to the banking industry’s Basel standards, Pillar 1 sets out quantitative requirements; Pillar 2 tackles risk management and governance; Pillar 3 addresses transparency, reporting and public disclosure.
At the mercy of politicians
UK Budget highlights insurers' vulnerability to political risk
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Moving towards unified risk management approach
Progressive insurers revise approach to sovereign risk
Some supervisors pressing firms to risk weight sovereign bonds
Concerns mount over periodical payment orders
General insurers embrace capital modelling and revised ALM strategies
Own funds rule will reduce reported solvency ratios, say insurers
Industry says European Commission proposal will have negative side effects
ECB calls for lighter treatment of high-quality ABS
Bank of England and ECB to promote coherent approach to ABS regulation
Insurers face tight deadline for matching adjustment
Firms urged to rush restructuring of portfolios for Solvency II long-term guarantee measure
Solvency II proposals cause confusion on non-euro extrapolation
Draft delegated acts suggest the last liquid point for non-euro currencies could shift
Cuts to securitisation capital charges too small, say experts
But European Commission proposals can stop insurers becoming forced sellers of low-risk securitisations
Insurers urged to review data licence requirements
Negotiate with vendors now to secure best prices, say experts
Cap 'too high' on Solvency II credit risk adjustment
Proposed changes will fail to prevent balance sheet volatility, say experts
Solvency II asset data formatting will breed ‘inconsistencies’
Insurers and asset managers warn of difficulties generating coherent data codes for alternative assets
Insurers weigh home-loan investment as efficient source of yield
Capital charge for residential mortgages under Solvency II makes buying loan portfolios more attractive, say bankers
EC to restrict deferred tax assets in Solvency II
Rules expected to be tightened on determination of future profits
German insurers ‘better off’ with Solvency II static transitional
Static transitional will smooth impact of unrealised gains on profit shares
National regulators to consult on additional insurer reporting requirements
Concerns national specific templates could lead to gold-plating and increased reporting burden
Are insurance companies prepared for the investment infrastructure challenges ahead?
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Insurers clamour for materiality guidance on Solvency II reporting
PRA claims it cannot offer advice until publication of Implementing Technical Standards
Brazil applies for Solvency II equivalence
Regulator to introduce Orsa requirement and toughen governance rules in 2015
Solvency II’s level 2 is the next battleground
Insurers have concerns about European Commission's unofficial Level 2 text
UK insurers’ internal model validation processes 'hugely inefficient'
Firms struggling with validating external models, expert judgement and risk dependencies, say experts
Concessions on Solvency II equivalence not followed through in level 2 proposals
Requirements for using deduction and aggregation method to calculate SCR of subsidiaries remain too high, insurers say
Insurers claim draft level 2 proposals could water down volatility adjustment
Inclusion of non-fixed-income assets in reference portfolio is 'unjustified'