Introduction: Starting the Solvency II Journey
Solvency II: The journey so far
Internal Models and Solvency II
Review of the Capital Adequacy Framework in Singapore
Insurance Liabilities Under IFRS 4 Phase II and Solvency II: Almost the Same Thing?
Solvency II and Mutual Insurance Companies
The Journey Towards an Approved Internal Model
The Road to Solvency II for a Life Insurance Company
Managing Model Risk
Solvency II and Reinsurance
ORSA: A Forward-looking Approach to Risk and Capital Management
Risk Governance: A Framework to Support Better Decision-making and a Journey Towards Continuous Improvement
Operational Risk and Solvency II: A Practitioner Perspective
Reporting Challenges under Solvency II: The Allianz Experience
The Audit of Solvency II Information
The Holistic Balance Sheet: A Different European Approach for Pension Funds?
Capital for Operational Risk: Some Fundamental Flaws
Reputational Risk: Success is Trust-dependent
For major insurance companies the solvency position has been very important and, given the market turmoil, has been monitored on a frequent basis. With the stabilisation of the financial markets, the focus for the coming years will be on the capacity to pay out dividends and, relatedly, the solvency level. The move from Solvency I to Solvency II in 2016 will receive a great deal of attention from the financial markets. The Solvency II programme needs to be finalised before then and, despite all the efforts so far, much work still needs to be completed.
This chapter will focus on the experience of a life insurance company dealing with Solvency II. It will present the organisation of the programme, as well as the planning for the model development. As will also be shown, data poses issues for all companies subject to Solvency II. For a life company, two categories of models are important: cashflow models and risk models, which will be examined in detail. All these aspects described need to be managed coherently to bring the Solvency II efforts to their ultimate objective of regulatory compliance.
The Solvency II programmes within insurance companies have been ongoing