Nine out of ten insurers based in Europe, Middle East and Africa (EMEA) say that preparing for the implementation of Solvency II is a challenge for their business, with 31 percent citing it as a major challenge.
The findings that come from a global insurance survey commissioned by State Street and conducted by the Economist Intelligence Unit also highlighted that almost half of EMEA insurers (49 percent) describe their approach to Solvency II as very proactive.
The survey, conducted amongst more than 300 senior insurance executives, also found that 83 percent of respondents said that adapting to evolving insurance regulation represents a challenge to their business.
Three quarters of survey respondents said ensuring transparency of business policies and procedures presents some level of challenge.
Only 17 percent of insurers did not view the regulatory environment as posing a challenge at all.
Sven Kasper, director of regulatory, industry and government affairs for EMEA at State Street, said: “As one would expect, Solvency II tops the list of European insurers’ regulatory challenges. However, there are other significant regulatory initiatives impacting European insurers that may become equally as challenging, such as FATCA by increasing the data and reporting requirements, or the EU11 Financial Transaction Tax leading to increased transaction costs and lower returns.”
“This rapidly changing, more complex and demanding regulatory environment has a significant impact on insurers’ overall operations as well as their plans for meeting new and challenging demands from their customers. They need to closely follow regulatory changes impacting them and their clients and maintain adequate systems to accommodate the numerous new regulatory obligations, in particular with regard to transparency and reporting.”
