Solvency II modelling could cause systemic risk, industry warns

Newton Cradle

Modelling regulations under Solvency II could lead to systemic risk for the insurance industry, according to speakers at the Federation of European Risk Management Assocations (Ferma) forum in Stockholm.

"Looking back at the 2007–2008 financial crisis, there was systemic risk created by the models," says Lex Baugh, chief executive at Chartis Europe. "If you look at the way we're building our models for Solvency II, there are basically three suppliers to the market and everybody is using a

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