Interactive Data pitches into the Solvency II market today with a service based on existing technology plus one data element sourced from DTCC’s Avox.
The company’s Solvency II Service is available immediately to help insurance companies, asset managers and fund administrators ready themselves for the first Solvency II deadline of January 1, 2013. By this time, companies with non-standard risk models for reporting under the directive must be ready to collect historical data for a year before reporting goes live in January 2014. At this point, the final deadline, firms using standard models for risk as set down in the directive must also be ready to report.
Bob Cumberbatch, head of regulatory and industry affairs at Interactive Data, says: “We started considering Solvency II in earnest last year and made implementation plans to execute a solution early this year. As a broad supplier of pricing and reference data we looked at the specification and requirements of Solvency II and decided to use our underlying technology to deliver a solution. We focused on three elements: the Complementary Instrument Code (CIC); the NACE company classification scheme; and company identifiers.”
The company used its existing reference data to implement the CIC requirement and made this part of the service available to clients. To fulfil the NACE requirement it is sourcing data from Avox and providing either a separate or blended service including CIC instrument codes. While legal entity identifiers (LEIs) are not specifically part of Solvency II and are not yet part of a global system, the company has acknowledged firms’ expected use of them in its company identifiers.
With these elements in place, Interactive Data says its Solvency II Service can help firms calculate market and default risk measurements demanded under the directive’s Minimum Capital Requirements and Solvency Capital Requirements, and provide the additional asset data required for the Quantitative Reporting Templates.
“Some of the large firms using standard models to meet Solvency II see the possibility of reducing their required regulatory capital if they implement and are ready to report under Solvency II in January 2013,” says Cumberbatch. “Others are taking a less urgent approach and budgeting Solvency II for next year.”
He names the usual suspects including SIX Financial Information, Thomson Reuters and Bloomberg as potential competitors in the Solvency II space, but hopes to work with not only existing customers among insurance companies, asset managers and fund administrators, but also attract new clients to the Solvency II Service. The company is already talking to potential users of service and with about 3,700 firms in Europe expected to feel the impact of the directive there is much to play for.