The leading knowledge platform for the financial technology industry
The leading knowledge platform for the financial technology industry

A-Team Insight Blogs

European Insurers Struggle to Meet January 2016 Solvency II Compliance Deadline

As the January 1, 2016 deadline for Solvency II approaches, insurers across Europe are struggling to complete compliance programmes that have been held up by delays in one area causing knock-on effects in others and by slow regulatory approval of internal models for capital requirements that has left little time to work with asset managers and servicers that are also part of the compliance process.

Larger countries with the most advanced financial infrastructures are better prepared for Solvency II than their smaller neighbours, and Northern Europe is in a better position to meet the regulatory deadline than Southern Europe. There are country-by-country differences in terms of focus on the three pillars of the regulation, with insurers in Germany, for example, being confident that they have mastered the financial requirements of Pillar 1. In France, insurers have focussed on Pillar 3 requirements covering reporting and disclosure, and including the asset look-through element of the regulation that requires cooperation between insurers and their asset management partners.

Focussing on the look-through process, take up of the tripartite model developed by the Investment Association in the UK, Club Ampere in France and the BVI in Germany in an attempt to ensure common presentation of data that insurers need from asset managers has been chequered across Europe, with some large insurers making bilateral agreements with their asset managers.

Despite Solvency II’s design to ensure that insurers demonstrate and sustain solvency, asset managers have been proactive in tackling the regulation on behalf of their insurance clients and many recognise that the regulation, and the larger regulatory shift to which it belongs, will have an impact on their business models.

These and other findings are the result of a review of European readiness for Solvency II compliance published by Silverfinch, provider of a utility-type service for secure data sharing between insurers and asset managers, and entitled ‘The European Race to the Solvency II Finish Line’. John Dowdall, managing director of Silverfinch, says: “In spite of the deadline for Solvency II, the fact remains that there is much work to do. Across Europe, the majority of asset managers are aware of the benefits of helping their insurance clients with Solvency II, but how to respond to the regulation has clearly split the continent.”

With less than 100 days to go until the compliance deadline, the review concludes with some optimism, stating: “All is not lost, there is still time to achieve a satisfactory, albeit not perfect, introduction to Solvency II, however all of the stakeholders will need to up their game, and communication will be key.”

Related content

WEBINAR

Upcoming Webinar: The UK’s New Prudential Regime for Investment Firms – Time to Prepare!

Date: 23 March 2021 Time: 10:00am ET / 3:00pm London / 4:00pm CET Duration: 50 minutes With the implementation of the new Investment Firms Prudential Regime (IFPR), the FCA is aiming to streamline and simplify the prudential requirements for solo-regulated investment firms in the UK. Under the new regime, all MiFID authorized, Collective Portfolio Management Investment...

BLOG

ESG: The Next Frontier for Financial Services

ESG is everyone’s favourite topic right now, but the mass of different regulations, standards and reporting requirements can be confusing. Last week at the RegTech Summit Virtual 2020, we were delighted to speak with Beate Born, Head of Strategic Projects, Investment and Trading Platforms at UBS Wealth Management, to discuss how firms could best address...

EVENT

RegTech Summit London

Now in its 5th year, the RegTech Summit in London explores how the European financial services industry can leverage technology to drive innovation, cut costs and support regulatory change.

GUIDE

RegTech Suppliers Guide 2020/2021

Welcome to the second edition of A-Team Group’s RegTech Suppliers Guide, an essential aid for financial institutions sourcing innovative solutions to improve their regulatory response, and a showcase for encumbent and new RegTech vendors with offerings designed to match market demand. Available free of charge and based on an industry-wide survey, the guide provides a...