Disruptive technology could leave regulators behind – Stanworth


Posted on 5th October 2015 by Solvency 2 News in Europe |UK

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Focus on historical data is out of step with speed of change, says head of L&G Capital disruptive-technologies-wordcloud

Drones, social media and wearable technology are transforming insurance so fast that rules based on backward-looking information will soon look out of date, according to Paul Stanworth, managing director at Legal & General Capital, part of Legal & General Group.

So-called disruptive technologies are already changing insurers’ liabilities, but the data firms will need to weigh new risks is held outside the industry – largely in technology companies such as Facebook and Google, he told delegates at the Insurance Risk Europe conference in London on October 1.

As a result, Europe’s Solvency II directive, with its emphasis on modelling risk using historical data could soon begin to make less sense, he said. “We need one-in-200 year statistically relevant data to prove what our risk is. But who has the data in this new world? I can tell you that a lot of the data we need is not in the insurance industry.”

Continue Reading “Disruptive technology could leave regulators behind – Stanworth” at Risk.net News

Quitting Britain back on the Prudential’s agenda as new capital rules loom


Posted on 5th October 2015 by Solvency 2 News in Europe |UK

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The Prudential, Britain’s biggest insurer, has dusted off plans to uproot after 167 years and move abroad to combat incoming European Union rules on capital buffers for insurance companies.DWS 2015 Photos-72small

An internal report by the group on how to deal with the rules has proposed splitting its British business from its Asian and American operations.

While no decision has been taken by the company, led by US-born chief executive Mike Wells, this would open the door to shifting the company’s domicile to Hong Kong or Singapore from London.

British insurance companies are scrambling to comply with the new EU capital rules, known as Solvency II, which come into force in January.

Splitting the group into UK and non-UK divisions is just one option under consideration by the Prudential. Management are also thought to be considering riding out the new capital rules and keeping the group together.

Continue Reading “Quitting Britain back on the Prudential’s agenda as new capital rules loom” at Independent News

New EU Rules to Promote Investments in Infrastructure Projects


Posted on 30th September 2015 by Solvency 2 News in Europe

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One of the goals of the Capital Markets Union is to help mobilise capital in Europe and channel it to the infrastructure and long term sustainable projects that Europe needs to create jobs. By1007_calgary-canada_485x340

amending the rules on how much capital insurance companies need to hold, the Commission is giving them incentives to invest for the long-term in infrastructure. These changes will free up millions of euros for new investment in projects like the energy pipelines, transport links and broadband rollout that are vital to maintaining and boosting Europe’s competitiveness.

The European Investment Bank estimates that the EU may need up to €2 trillion in investment in the period up to 2020. Public support through measures such as the €315 billion Investment Plan for Europe (IP/15/5420) will help, but there is a clear need for more private investment in such projects in the longer term.

Continue Reading “New EU Rules to Promote Investments in Infrastructure Projects” at New Europe News

SCOR expects new reinsurance demand as Solvency II approaches


Posted on 28th September 2015 by Solvency 2 News in Europe |UK

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A potential bright spot for reinsurers has been highlighted by global reinsurance company SCOR, which is expecting to see an increased and new demand for capacity from some of its larger,demanding-job-ftr-1024x640 global clients, as the implementation of Solvency II approaches in early 2016.

SCOR sees its larger clients increasingly focused on services, rather than just capacity and price, after its meetings with important cedants in Monte Carlo this year, according to analysts at RBC Capital Markets.

With strong client relationships, SCOR also gets to discuss the future needs of large cedants and according to the analysts the French reinsurer is expecting to find opportunities to deploy additional capacity in the coming months.

Continue Reading “SCOR expects new reinsurance demand as Solvency II approaches” at Artemis News


Fed governor walks tightrope on insurer capital reserve rules


Posted on 28th September 2015 by Solvency 2 News in Europe

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Fashioning capital requirements for large insurers with a mix of traditional, nontraditional and noninsurance activities presents regulators with challenges, according to a governor of the Federal tightropeReserve. In remarks prepared for delivery to the Banque de France conference in Paris on Monday, Federal Reserve Gov. Daniel K. Tarullo noted that traditional insurance liabilities “argue for lower capital requirements than might be required for a hypothetical bank holding a similar portfolio of assets.”

Life insurance has an “unusually predictable liability pattern,” and property/casualty insurance, while a bit more volatile, has a volatility that isn’t correlated with the broader economy, he said.

Continue Reading “Fed governor walks tightrope on insurer capital reserve rules” at Business Insurance News

Insurance M&A deals reach more than $80bn in value


Posted on 24th September 2015 by Solvency 2 News in Europe |UK

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In the first seven months of 2015 deals worth more than $80bn (£52bn) were struck, a high not seen since 2010, when deals worth $142.6bn were recorded for the entire year, according to PwC.


However, while the value of deals has gone up, the number has dropped from almost 750 in the first seven months of 2011 to just under 450 in the same period of 2015.

PwC said firms wanted to “sharpen efficiency” in areas including capital, underwriting and taxation, cut costs and strengthen margins.

Continue Reading “Insurance M&A deals reach more than $80bn in value” at The Actuary

Bermuda makes ‘substantial amendments’ to insurance laws to meet Solvency II criteria


Posted on 23rd September 2015 by Solvency 2 News in Bermuda

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Bermuda has made “substantial amendments” to the regulations applicable to commercial insurers and reinsurers to comply with Solvency II rules. 203894496305-1024x768
Bermuda is currently granted provisional equivalence under Solvency II.

In a progress report on Bermuda’s Solvency II equivalence, the European Insurance and Occupational Pensions Authority (EIOPA) said changes included amendments in the Insurance Act 1978, the Insurance Code of Conduct and the Bermuda capital solvency requirement.

The changes covered a range of areas including powers and responsibilities of the Bermuda Monetary Authority (BMA), systems of governance and public disclosure and solvency assessments.

Continue Reading “Bermuda makes ‘substantial amendments’ to insurance laws to meet Solvency II criteria” at The Actuary

Old problems and new solutions


Posted on 21st September 2015 by Solvency 2 News in Europe |Middle East

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Arndt Gossmann, CEO of DARAG, reflects on the main topics of conversation at this year’s Monte Carlo Rendez-vous.thought_leadership

This year’s discussions at the Rendez-vous in Monte Carlo were dominated – again – by three key topics: the rise in the M&A business including increasingly large M&A tickets; the final preparations for Solvency II and run-off, all a clear sign of the industry´s and investors´ interest in the industry; and also of its ongoing consolidation.

The weather in Monte Carlo just prior to the conference kick-off was befitting the discussion around the cat bond market – a sharp rain had swept the coast of Monte Carlo and the Mediterranean Sea just days before the conference started. As in the world of reinsurance business, where major risks had not materialised in the past year, fortunately there were no severe demolitions in Monte Carlo either.

Continue Reading “Old problems and new solutions” at Intelligent Insurer News

UK’s Phoenix Group in talks to acquire Guardian Financial


Posted on 17th September 2015 by Solvency 2 News in UK

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Phoenix Group Holdings (PHNX.L), Britain’s largest owner of life assurance funds closed to new customers, is in talks to buy Guardian Financial Services, it said on Thursday, although analysts51b9697328de953236 say uncertainty over new capital requirements for European insurers could delay any agreement.

The move comes as life insurers in the UK are also having to adapt to an overhaul of taxation rules which effectively give retirees more control over their pension pots, no longer compelling them to buy annuities on retirement.

Shares in Phoenix, which makes money by buying up closed life books and running them more efficiently, rose as much as 4.8 percent to 902.5 pence after it confirmed a media report on Wednesday, before slipping back to trade at 867.5 pence by 1215 GMT.

The company said it was evaluating a bid for Guardian Financial, currently owned by private equity firm Cinven [CINV.UL], as one of a number of further “consolidation opportunities” in the UK closed life sector…

Continue Reading “UK’s Phoenix Group in talks to acquire Guardian Financial” at Reuters


European Parliament accepts Commission decision on Swiss equivalence under Solvency II


Posted on 16th September 2015 by Solvency 2 News in Europe |UK

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The Swiss insurance industry will soon be able to operate across the EU, after being granted “full equivalence” under EU insurance rules.

The European Parliament has updated its procedure file, stating that it will not object to a European Commission’s decision to grant “full equivalence” to Swiss_flag_5the Swiss insurance regulatory regime in Solvency II.

The Commission announced in June that Switzerland was given full equivalence, in all three areas of Solvency II: solvency calculation, group supervision and reinsurance, for an indefinite period.

Solvency II is a European Commission project for implementing a harmonised solvency regime across the EU. It sets out risk management requirements for European insurers and dictates how much capital firms must hold in relation to their liabilities.

Continue Reading “European Parliament accepts Commission decision on Swiss equivalence under Solvency II” at Out-Law News