Half of European insurers have implemented formal Solvency II programmes
The majority of European insurers believe that Solvency II will improve their companies' risk and capital management functions, and half have enacted formal programs to address the proposed European Union (EU) directive, according to results of a survey released by Accenture today.
According to the survey, 78% of European insurers believe that Solvency II will improve transparency and controls in managing risk and capital, and 62% anticipate improvements in their firm’s allocation of regulatory capital. 41% of respondents expect to realize competitive advantages as a result of Solvency II, and nearly 24% anticipate receiving improved credit ratings due to the directive.
Though the final text of the directive is not expected until February 2007, half of the insurers surveyed have already started formal programmes to plan for Solvency II.
Additional key findings from the survey:
-- Most respondents foresee a moderate or significant impact from Solvency II across most major organisational functions. A majority anticipate moderate or significant impacts on risk (92%), capital management (89%), finance (89%), reserving (84%), product pricing (84%), corporate governance (84%), strategy and planning (79%) and asset management (76%). Most anticipate significant impacts on their risk (57%) and capital management (54%) organisations, and roughly one-third expect significant impacts on their asset management (35%) and finance (30%) functions.
-- Many insurers believe Solvency II will improve the integration and performance of vital organisational functions. Two-fifths (41%) believe it will bring a significant increase in the level of integration between their actuarial, operational risk and finance functions. Roughly one-third (30%) said they anticipate significant increases in process efficiency between these functions and their business lines.
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