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Benedicte Gravrand, Opalesque Geneva: As European insurers are scrambling ahead of the implementation of Solvency II, a new EU directive, BlackRock commissioned a report on the effect of Solvency II on asset allocation and investment strategy, which was written by the Economist Intelligence Unit last month.
The report found, among other things, there is a degree of discrepancy between market perception and what insurers think, "particularly in relation to use of alternatives and their levels of preparedness for Solvency II governance and disclosure requirements." It also found that alternatives such as hedge funds and private equity will benefit from the new requirements.
Solvency II is a fundamental review of the capital adequacy regime for the European insurance industry, which means that all EU/EEA countries will be united by a single set of rules governing what constitutes an acceptable level of insurer creditworthiness. This EU Directive should come into effect on 1 January 2014.
There are uncertainties as to whether the date of implementation will be pushed back a year, says the BlackRock report (Balancing risk, return and capital requirements),...................... To view our full article Click here
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