If any readers need a reminder that January 1 is D-Day for Solvency II, the European legislation designed to prevent insurance companies from collapsing due to insolvency, experts at secure fund data utility Silverfinch have issued exactly that.
Says John Dowdall, Silverfinch managing director: “The legislation that comes into force on January 1 bears little resemblance to the proposal first made by the European Union some years ago. It’s bigger, it’s more expensive, it’s data intensive and there are serious questions about the ability of financial regulators to make meaningful sense of the tsunami of information that insurance companies are about to send them.”
The real test, he adds, is not what happens on January 1, but what happens in three to four months when insurance companies will have their first audits under Solvency II. “That’s when we’ll find out if the industry is truly compliant and just how much importance the regulator is going to place on getting it right.”