Solvency II


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Solvency II

Proposed regulation for insurers in the European Union. Solvency II would harmonize the insurance regulation in EU member states, permitting any insurer registered in one member state to operate in any other member state. Solvency II would put in place capital requirements for insurers to reduce the risk that they would be unable to meet obligations when an unusually high number of claims has been made. Solvency II is expected to take effect in January 2013.
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Today, more than 40 insurance companies spanning many European countries including The Netherlands, Italy, Spain, Portugal, Austria, Slovenia, Norway and Sweden rely on Tagetik to automate Solvency II compliance reporting.
Together, Dublin-based Silverfinch and Luxembourg-based Fundsquare would develop their "look-through" and "data utility" services that are designed to aid insurers and asset managers to cope with the regulatory obligations of the Solvency II Directive.
Solvency II requirements would require captives to conform to rules about capital levels that must be maintained by insurance businesses within the European Union.
One approach for meeting Solvency II requirements is to focus on the applications and related metrics.
The remaining captive domiciles are closely monitoring the developments of Solvency II but several have taken a different position.
By the proposed Solvency II implementation date of January 2014, insurers will have to make significant changes to their finance and risk management systems, and prepare for greater public disclosure of financial statements, modelling and capital calculations.
Like many financial services organizations, it needs to comply with the Solvency II Directive that requires insurers to demonstrate they have enough capital to remain solvent and have effective risk management systems in place.
In addition to enabling insurance firms to measure themselves against the requirements of Solvency II, Eagle's solutions can also be used to generate the Quantitative Reporting Templates (QRTs) required to demonstrate compliance to the regulator.
As pending deadlines draw near, Solvency II regulation will require insurers located or doing business in the EU to calculate and document solvency through detailed public reports and audits.
Under the coming Solvency II guidelines, sub-debt instruments "are designed to alleviate financial pressure in times of stress," IRC said in a report.
EFG Eurolife views the European directive Solvency II as more than a regulatory compliance project.
Solvency II is a European Union directive designed to ensure insurance companies operating in Europe have enough underlying assets to cover their insurance commitments.