The aim of Solvency II is to provide policyholders with greater security. However, many life insurers worry that the new rules will make it harder, not easier, for them to achieve stability. Intelligent Insurer investigates why.
“Solvency II makes it difficult to construct an economic balance sheet which properly rewards the life insurer and at the same time makes sure that its customers have a product they want.”
This is the opinion of Jeremy Nurse, consulting actuary at Towers Watson, who believes that the new Solvency II regime will present several problems for life insurers. He is not alone in having these concerns.
According to Catherine Munt, senior manager, actuarial issues at Insurance Europe, formally the Comité Européen des Assurances, one implication of the current interpretation of Solvency II could be the creation of artificial volatility in life insurers’ balance sheets.
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Life insurance, Solvency II, Friends Life, Insurance Europe, Fitch, Standard Life, Ergo life