Report by Tarisai Mandizha
The Mordenising Insurance Regulation—Solvency II seminar comes at a time when the sector has been on a growth trajectory following a slump at the height of the country’s unprecedented economic meltdown which ended in 2009.
Solvency II is a framework developed to guide the regulation of insurance in the European Union and its primary concern is the determination of the amount of capital that insurance companies have to hold to reduce the risk of insolvency. Last year Ipec raised minimum capital levels for shortterm insurance players to
$1,5 million from $300 000.
Continue Reading “Ipec Convenes Capitalisation Seminar” at News Day
The ratings agency issued a report considering the future of the Solvency II plans and based on comments made by S&P staff during a conference in Dublin last month. It noted that the existing regulatory system, Solvency I, was ‘virtually devoid’ of incentives for good risk management. It also lacks capital requirements for asset risk, it said.
This means Solvency II, which will place new capital requirements on insurers depending on the results of a risk-based assessment of their assets and liabilities, is ‘needed now’.
Continue Reading “Solvency II is Still Needed, says Standard & Poor’s” at The Actuary News
In what are likely to have been his last public comments before stepping down from the role within a matter of months, financial regulator Matthew Elderfield effectively launched a broadside against deputy AIB chairman Michael Somers.
Strong regulation and an adequately resourced watchdog are essential if the “terrible costs” of the banking failure to taxpayers and society are not to be repeated, he warned.
Mr Somers, the former head of the National Treasury Management Agency, who’s a government-appointed director to AIB, claimed last week that global banking giants such as Goldman Sachs are leaving the International Financial Services Centre in Dublin due to over-regulation.
Continue Reading “Elderfield Clashes with AIB’s Somers on Cost of Regulation” at Independent News
Dealing with missing legal framework
Much of the success of the interim measures will depend on the level of compliance with the Guidelines. One key obstacle is that in some member states the legal framework to apply the rules is not yet in place.
EIOPA says it is aware of these limitations but is optimistic that a sufficient level of compliance will be achieved despite this. Patrick Hoedjes, Director of Operations at EIOPA told Solvency II Wire in an interview, “The expectation is that we will also have some explanations, not only compliance. A further expectation is that the majority of members will comply, maybe not in the first stage, but certainly in the later stage of the preparatory period.”
Continue Reading “Solvency II News: Details of Compliance with Interim Measures Emerge” at Solvency II Wire
The Solvency II rules for insurers are not necessary and there is no need to centralise regulation at EU level to ensure the free movement of financial services around Europe, writes professor
In 2008 the United Kingdom’s Treasury department, writing about the potential ‘benefits’ of Solvency II, said: “Solvency II is based on a three-pillar approach used in the Basel II banking accord.” This was at the height of the banking crisis and came without any apparent recognition of the failure of regulation in that crisis. This is hardly the best recommendation for Solvency II.
More recently in a leaked letter Andrew Bailey, head of the Prudential Regulatory Authority, criticised Solvency II, the complex set of rules being developed by the European Union to regulate all insurers in the bloc in a uniform way. He was right to do so. Everything about Solvency II is misconceived. It is estimated that it will cost EU insurers £3bn.
Continue Reading “Scrap ‘misconceived’ Solvency II Regulations” at Public Service Europe News
European rules aimed at making insurers safer may cost the industry as much as 200 million pounds ($310 million) a year in the U.K., said Andrew Bailey, the country’s top banking and insurance supervisor.
The delayed rules, known as Solvency II, may see insurance premiums increase by 0.1 percent to cover the cost of compliance, Bailey, chief executive officer of the Prudential Regulation Authority, said in a letter to Andrew Tyrie, chairman of the U.K.’s Treasury Select Committee, dated April 19 and released by Tyrie today.
Continue Reading “ Solvency II Rules Seen as Costing U.K. Insurers $310 Million” at Bloomberg News
A listed Lloyd’s of London insurer that has been based in the City for more than 20 years is planning to relocate to Bermuda
– citing persistent uncertainty over new European regulations as one of the main reasons for its move.
While a number of European insurers, including Prudential, have threatened to redomicile because of the incoming Solvency II rules on capital requirements, Randall & Quilter (R&Q) revealed on Thursday that it has drawn up firm plans to go overseas.
Consultants said the Aim-quoted insurer’s proposals showed that industry warnings about Solvency II were not mere sabre-rattling, and that larger groups in the sector were looking closely at their options.
Continue Reading “Lloyd’s Insurer Relocating to Bermuda” at Financial Times News