Over 90% of insurance executives concerned by Solvency II

Some 90 percent of insurance professionals are anxious about the implementation of Solvency II, which is set to be implemented on January 1, 2016.

This is according to a survey conducted by Intelligent Insurer, following an article by ‘Manuel, the Scandinavian actuary’ who aired his concerns to us in July, 2015.

The survey revealed that over 90 percent of respondents were concerned about a number of issues including the design of the model and the guidance from the European Insurance and Occupational Pensions Authority (EIOPA).

One executive claimed that Solvency II is a “travesty of actuarial thinking” and would be a nightmare to those affected, while adding that it is a “stupid and monstrous regulation”.

Others, agreeing with Manuel, complained that the regulations were overly complex, especially for smaller firms and that the legislation would “drown” business employees in Solvency II work.

One respondent lamented the fact that Solvency II regulations had not been drafted by someone “legally-minded”, adding that “insurers will need every last day of their transition period”.

Also in agreement with Manuel, a number of respondents criticised EIOPA’s guidance, calling it a “Fawlty towers inspired service”.

Some were also confident that reducing the ambiguities and complexity in implementation of Solvency II “would indeed achieve more clarity on the validity (and limitation) of models in shorter and more meaningful timeframes”.

The respondent added: “Such steps could greatly help insurers, reinsurers and regulators to be as agile as they will need to be in the future of interconnected financial markets. Any such simplification would need to have the end-in-mind: a simplified, but valid view of risk(s); some of these views might equally be interpreted in isolation without requiring an entire IM-framework.”