Developing structured solutions for Solvency II

Shopping for Solvency II

A raft of products to meet insurers' needs are being developed

One of the main elements that differentiates the European Solvency II directive from its predecessor is a move towards mark-to-market consistency based on the economic risks insurance companies take. In effect, the riskier the investment, the more costly the regulatory capital requirement will be for the insurer, as the new regulation seeks to increase policyholders' protection by having insurance companies take into account the asset side on their balance sheet. As a result, insurers should