ORSA: The heart of ERM

I’ve stolen and paraphrased Gideon Benari at Solvency II Wire, as he calls the Own Risk and Solvency Assessment “the heart of Solvency II.” But ORSAs are coming to the United States, with the NAIC developing guidelines for large companies to report on their ORSAs. With the Europeans building the ORSA portion of Pillar II, [...]

Solvency II thumbs up (mostly) for Bermuda, Switzerland, Japan

I was hoping someone else would slog through today’s reports by EIOPA, the EU’s uber-quasi-regulator. Thanks, Reuters! LONDON, Oct 26 (Reuters) – European insurance watchdog EIOPA has said Bermuda’s regulatory regime for big insurers mostly complies with its own strict Solvency II rules, easing fears of a mismatch that could have hindered Bermudian players’ access [...]

Solvency II stress tests: Good news/bad news

Americans back from holiday can catch up on the Solvency II stress test result with this slide (from regulator EIOPA’s pdf presentation): The regulator created four stresses. The most stressful turned out to be the adverse scenario, with 13 failures. This is kind of a good news/bad news situation. Yes, 10% of groups tested failed. [...]

Big guns aim at Solvency II

Well, not quite as dire as my headline, but when four leading industry bodies – the CEO Forum, the CRO Forum, the Pan European Insurance Forum and the European insurance and reinsurance federation – decide to tag-team Solvency II . . Obviously this action and others like them won’t be enough to derail the initiative, [...]

Solvency II: Internal models shrink capital needs, QIS5 results show

EIOPA summarizes the results of QIS5 in press release here (pdf). Compared to the calculation under Solvency I standards, insurance groups have €86 billion less surplus capital available, which is a reduction of 44%. However, the QIS5 exercise demonstrated that this effect would be largely absorbed if insurance groups apply internal models and transitional measures [...]

Solvency II: QIS5 goes into overtime

The deadline had been Nov. 30 for the big data call. Now it’s Dec. 31, according to CEIOPS, the European uber-quasi-regulator. (or is it quasi-uber-regulator?) Oh, and it’s OK if you can’t get net data. Gross is fine. Just do your best. Details here.

Solvency II starts IT bidding war

Via Crystal Umbrella News:   Professionals in the IT contracting community who work on Solvency II projects have seen their rates of pay rise by 50 per cent, the survey reveals. In hard cash terms, this translates to between £600 and £900 per day.  

Munich Re to Solvency II: Take 5

Munich Re backs five-year phase-in for Solvency II | Reuters. Last week, CEIOPS hinted that S-II should be phased in, rather than have a big switch-over at 12/31/2011. Now Munich Re wants to up the ante. Phase-in makes sense, as it feels to me like a lot of insurers were caught short with the technological [...]

Chart of the Day: Reinsurer values

Guy Carpenter’s COTD shows the price-to-book ratio for global reinsurers is at a 20-year low: Price-to-book, for the non-investor, is the ratio of stock price per share to book value (which is basically surplus) per share. A price-to-book of less than 1.0 implies that the market thinks the value of the firm is less than [...]

Malta grapples with Solvency II

The Actuary reports on how the EU’s smallest member is handling the prospect of Solvency II. It’s a nice story because it makes this monster of a topic manageable, since Malta – a spec just south of Sicily – has less than €1B in premiums (life and non-life combined). The main QIS4 results were: Solvency [...]