General Insurance Article - How ready is the UK insurance industry for SII

 “The UK insurance industry is generally in good shape when it comes to complying with the requirements of Solvency II. In part, because the UK industry already had a rigorous risk-based framework in place with its Arrow process. However, this is not a uniform picture across all EU members states – with some countries facing a technology challenge to hit the expected 2016 deadlines.

 
 In general, the larger EU member states are in good shape to achieve compliance, but the original project completion dates have come and gone 18 months ago and there is still only a tentative go-live date. Meanwhile, insurers are still having to continue their spend on Solvency II project teams – which is a significant frustration, especially as market conditions remain tough in Europe.

 
 Most of Europe’s largest insurers have already invested significant amounts in re-architecting their systems to meet the demands of Solvency II – as much as €5bn across the industry according to some estimates. The key challenge has been gathering the data required, which is often scattered across many differing legacy systems, to build a picture of the true risk an insurer is exposed to.

 
 But, the more comprehensive and detailed picture of risk that insurers now have is driving positive benefits. At Ovum, we are seeing a number of insurers embedding this greater insight to improve their business by targeting niche sectors or improving the accuracy of their pricing.”

 
 Charles Juniper, senior analyst, insurance technology, Ovum