Over a third of insurers are planning to change their prices in response to the new Solvency II regulation, according to a study by Deloitte.
The amount of insurers planning to re-price their products, 36 percent, had also risen significantly since the same time last year, when only 19 percent were considering doing so.
“This year’s survey has identified interesting developments in insurers’ approaches to Solvency II and many have reviewed the way it will be implemented,” said Rick Lester, lead Solvency II partner at Deloitte.
“In past surveys insurers have talked of the need to restructure and reorganise their business; now they are analysing the risks they run and reviewing the amount of capital they need to write these risks, and adjusting their pricing and product mix accordingly.
“By adjusting their product mix, insurers are able to optimise the diversification of the different risks in their portfolios. This may lead some companies to consider acquiring books of business while others may withdraw from some parts of the market. We’re also seeing increasing use of reinsurance and hedging mechanisms across the industry to lay off more capital-intensive risks.”
Solvency II, Deloitte, insurance pricing