Solvency II Survey 2011 Insurers’ responses to evolving rules We are delighted to present this fourth annual Deloitte Solvency II Survey Having been immersed in preparations for the Solvency II regime for several years now, insurers are faced with the continuing challenge of responding to a mandatory change where the exact ‘rules of the game’ are still evolving This report has been produced on our behalf by the Economist Intelligence Unit based on their findings from interviews during February 2011 with 60 insurers with UK operations Through their fully anonymous survey process, the Economist Intelligence Unit is able to offer an impartial view of the true state of play for UK insurers and also give a flavour of the trends since the last survey Survey information can provide organisations a useful checkpoint as preparations continue and offer a perspective on where they stand in relation to their peers Significant progress has been made over the last 12 months and the survey identifies some interesting developments and trends The report’s findings highlight the far reaching consequences of Solvency II, including the number of companies looking at restructuring or relocating and the anticipated consumer impact as a result of changes in product mix, design and pricing Implementation resource shortfall across the industry is a significant challenge and there is a decline in confidence that the industry will complete the journey on time We are very grateful to the EIU and to all participants for their contribution to this research I hope you find the Solvency II Survey 2011 useful – please contact me if you would like to discuss any aspect of this report Rick Lester Solvency II Lead Partner rlester@deloitte.co.uk Solvency II Survey 2011 Insurers’ responses to evolving rules Introduction The European insurance industry has been immersed in preparations for the Solvency II regime ever since the adoption of the final text of the Directive in 2009 Yet much preparatory work remains to be done as organisations, along with their local regulators, continue to wait for the regulatory requirements for implementation to be finalised While the final deadline for compliance is moving from November 2012 to January 2013 there is uncertainty as to how the transitional arrangements will be applied in practice The European Insurance and Occupational Pensions Committee (EIOPC) and the European Commission are currently scrutinising level two implementing measures (which will specify how the Directive’s principles must be applied in practice) The outcome of this is dependent upon the EIOPC’s simultaneous review of the Omnibus II Directive to bring Solvency II into line with the Lisbon treaty, which will come into force in the fourth quarter of 2011 The European Insurance and Occupational Pensions Authority (EIOPA) will also be developing level three text until the end of this year and will approve the final guidelines after a period of consultation in the first quarter of 2012 Figure In which region is your head office domiciled? 5% In February this year, the chief executive of the Financial Services Authority (FSA), Hector Sants, acknowledged a number of outstanding issues of the “utmost importance” to the insurance industry regarding Solvency II and noted that further debate and analysis were still needed to address ongoing anxieties However, as the window of opportunity to shape the final regulations gradually closes and insurers are expected to work within the new regime, how ready is the industry for implementation and what are the causes of greatest concern? Following on from research in 2010, the Economist Intelligence Unit, commissioned by Deloitte, again surveyed a sample of 60 UK-based insurers to ascertain their latest views on Solvency II and reassess their readiness for the new regime Respondents covered all types of business from smaller, stand-alone organisations to large groups Respondents were grouped by size with the very largest insurers reporting more than £5bn in net written premiums (NWP); large insurers with between £1bn and £5bn NWP; those with £500m to £1bn; £300m to £500m; £100m to £300m; and less than £100m NWP Thirty respondents were life companies, 28 were nonlife and two were composite Figure Where does your group operate? % 4% 80 5% 70 60 50 40 30 20 86% 10 UK Australasia North America Other Europe UK Other Europe North America Middle East/ Africa Latin America Asia Heightened awareness Ninety-five percent of respondents’ boards were fully aware of and engaged in the regulatory responsibilities and opportunities arising from Solvency II, a rise from 83% in last year’s survey Only the very smallest insurers were yet to brief their boards on the potential implications of the new regime, while one non-life insurer with between £100m and £300m admitted that its board had no knowledge of Solvency II at all This lack of awareness was atypical, however, with most insurers taking positive action in preparation for the regime Ninety percent of all respondents and 100% of insurers with over £500m NWP had completed a gap analysis, while two-thirds of those surveyed had made the business case for Solvency II Figure What approximate percentage of the FTE resource required for your Solvency II programme has been put in place? % 40 35 30 25 20 15 10 0% Ulrich Zink, policy adviser at the Association of British Insurers (ABI), says: “Solvency II is clearly a top priority for the boards of insurers in the UK Whether this awareness is being driven by the regulator or internally, you can be certain every board in the UK is aware of Solvency II and is acting on it.” More than half (52%) of all respondents had reached the implementation stage including 75% of the very largest insurers (with over £5bn NWP) Reflecting this level of advancement, 60% of respondents have at least 60% of their complement of full time Solvency II employees already embedded However, the remaining 40% have 40% or less of their dedicated Solvency II personnel in place, with as many as seven (12%) insurers having only embedded 20% Training programmes are scheduled at 58 of the 60 insurers surveyed, with half of the respondents offering general training for all employees and tailored training for key personnel 2010 20% 40% 60% 80% 100% 2011 Figure What training programme you have in place for Solvency II? % 50 40 30 20 10 A combination Tailored of general training training for for some all and tailored training for some General training for all General training for some No structured programme Tailored training for all impacted by Solvency II Solvency II Survey 2011 Insurers’ responses to evolving rules Future focus Figure Which of the following areas will your organisation be focusing on most in the next six months? (Respondents were asked to select and rank five) Implementation planning Personal incentivisation and reward =2 Risk governance system =2 Data infrastructure and data handling processes Culture Risk appetite =5 Data quality =5 Performance measurement Documentation =7 Embedding and use =7 Deloitte comment – Richard Hurley Technology implementation issues are now becoming real The designs that have been developed are being handed over to the IT development teams and delivery plans are being developed These plans are now showing that either timescales are going to have to move or scope is going to have to be reduced In addition, although in many cases the architectures are simple, applications are being pushed beyond their original design specifications, either from a functionality or performance point of view This complexity is being added to by the need to undertake complex integrations with legacy systems For these reasons, many insurers are looking at how they can implement in a phased way and/or looking at using prototypes during the first phase of their implementations Data remains a key area of concern, be it the accessibility or granularity of data, and in many cases its quality Therefore many organisations are now looking at how they can simplify their data requirements in order to achieve a realistic solution Finally, the scale of the testing requirement is coming into focus The overall approaches to system integration and user acceptance testing are being developed These critical activities are putting pressure on overall timescales In spite of the ongoing uncertainty over the final demands from Solvency II, insurers are pressing ahead with their preparations for the new regime The focus of attention remains the same as last year and relates to preparations for securing approval for new internal models Given that 80% of respondents plan to implement a full internal (50%) or partial internal (30%) model under Solvency II, issues such as data infrastructure and data handling were listed as top-five priorities for the next six months, particularly among large insurers Similarly, implementing risk governance also tops the agenda for the first half of 2011 While the EIOPA is yet to publish guidance on internal models, which will be laid out in the commission’s level-two measures expected in June this year and EIOPA’s level-three requirements due in December, insurers were still focusing on internal model design and implementation, as well as the internal model approval process (IMAP) itself Respondents to the survey were confident they would meet the deadlines in this area with most insurers (88%) expecting to have entered the IMAP by the fourth quarter of 2011, one in 10 by the first quarter of 2012, while just one insurer (with NWP greater than £1bn) admitted it would be later In last year’s survey, one-third of respondents said they would lobby the regulator and industry bodies for support in dealing with the IMAP Subsequently the ABI has produced guidance for insurers, endorsed by the FSA The document, released in February, suggested large insurers have their work plan in place by the end of March this year in order to reduce the burden on both their own organisation and that of the regulator in the run-up to final implementation of Solvency II Repercussions Understandably, respondents to the survey recognise that implementing such a regulatory overhaul will have far-reaching implications for their businesses Nearly half (47%) will have to reorganise or restructure as a result of Solvency II, with the highest instances among life insurers with between £1bn and £5bn NWP (71%) Much of the restructuring will arise from insurers recognising more efficient means of managing capital via branch rather than subsidiary structures While there may be opportunities to take elements of the business outside of the EU, relocation remains unlikely for most insurers, with just 8% of respondents saying they would move their business headquarters, as the tax implications of moving to new territories may preclude any benefits from side-stepping Solvency II However, one of the four largest insurers responding to the survey is considering relocating Figure As a result of Solvency II, you envisage your organisation will need to any of the below? % 50 40 30 20 10 Reorganisation/ Restructuring 2010 Relocation Not decided 2011 As the transparency requirements of Solvency II make it easier for insurers to identify which product lines are most profitable and which are most capital-intensive, businesses will be well-placed to streamline their offerings, removing those which have the least to offer One in five organisations claim they will need to re-price their products, with the largest and smallest insurers most affected Thirty-five percent of those with less than £100m in NWP and 75% of businesses with more than £5bn in NWP expect to re-price Deloitte comment – Stephen Ross As the implementation date for Solvency II approaches and board level awareness of its impact increases, it is apparent that insurers are beginning to appreciate the real implications it will have for their business It is very clear from the Survey and from our client conversations that Solvency II is acting as a catalyst for businesses to restructure For many businesses the driver for this has been to maximise capital fungibility and thus to be able to allocate capital effectively across the group This means that many businesses are transitioning from subsidiary structures (where capital is trapped in individual entities) into ones with branch structures where capital is more fungible across the group Another possible implication of Solvency II is the potential for M&A We expect that as the financial metrics associated with Solvency II become clearer, insurers will consider the options to drive towards the ideal business mix whilst being aligned to their overall strategy This is likely to lead to M&A activity in the form of acquisitions or disposals of portfolios, teams or companies as businesses look to achieve the scale and diversity they see as optimal under the new regime Life insurers were more likely than their non-life counterparts to make changes to their product mix, as capital requirements under Solvency II have a much greater impact on the types of long-term guaranteed products offered by life companies One in five life insurers said they envisage changing their product mix and redesigning products, compared with fewer than one in 10 non-life companies, while one-third of life companies and one in 10 non-life companies identified opportunities to launch new products under the new regime Mr Zink says: “Life insurers are selling long-term guarantee products and those attract heavy charges [under Solvency II] These are crucial products as many people rely on them for their retirement If the requirements remain as they currently are, firms will have no option but to either significantly increase premiums or to reduce their offering, shifting towards products where the risk remains with the policyholder Both scenarios will be to the detriment of the consumer for whom it is important to have good access to a range of appropriate products and propositions.” Given that a key motivation for introducing Solvency II is better appreciation and management of risk within the European insurance industry, it comes as no surprise that two-thirds of all respondents will introduce new riskmitigation techniques While an equal number of life and non-life companies said they would take this step, neither of the composite respondents had plans to so Solvency II Survey 2011 Insurers’ responses to evolving rules Aligning interest Not content with introducing Solvency II, European legislators are also focusing on international and other financial reporting standards Opportunities for insurers to align these differing demands are hampered by a lack not only of clarity but also of coherence According to the survey, interdependency with other change programmes is a top-three concern for businesses in implementing Solvency II Figure Do you plan to have a single integrated programme that will both implement Solvency II and manage the transition to IFRS Phase II? 18% 43% 38% Yes No Deloitte comment – Francesco Nagari When the Solvency II draft Directive was first published in July 2007, the International Accounting Standard Board (IASB) had also published its preliminary views on the future IFRS for insurance (IFRS Phase II Discussion Paper) At that point there was strong alignment between the two bases, both aiming at a market consistent valuation of insurance portfolios with day one profit recognised in IFRS financial statements The industry has lobbied the IASB to abandon that approach, deemed too volatile, in favour of a valuation that defers profit on day one (residual margin liability) and recognises it later based on the insurer’s own estimates Not decided Note: Figures not add to 100% due to rounding Fewer than half (43%) of respondents said they would take a single, integrated approach to implementing Solvency II and managing the transition to IFRS Phase II About two-thirds (64%) of the largest insurers said they would not try to integrate their response to the changes However, two thirds of respondents plan to align the reporting close processes of Solvency II with IFRS and a little over a third with MCEV Mr Zink says the ABI has been lobbying strongly for better alignment of the various pieces of European legislation and encourages insurers to take an integrated approach where possible “We have had some success in dealing with discrepancies between Solvency II and IFRS; we lobbied to align the two and we are moving towards that It is not helpful for different legislation to have several definitions for similar terms, which creates confusion and duplication of effort We will continue to lobby in this area,” he says Although the underlying building blocks of the valuation bases remain notionally the same (present value of expected cash flows and a risk margin liability) their detailed calculation is still apart in a number of areas, requiring careful assessment of Solvency II implementation decisions that may prove costly when IFRS Phase II is implemented The IASB expects to approve the final IFRS Phase II text in July 2011 with mandatory application from 2014 at the earliest, subject to EU endorsement On the positive side, the draft level rules appear to give insurers capital credit for the residual margin liability but require detailed reconciliations between the two bases to be published on a regular basis to the market and regulators Counting the cost In his February speech addressing issues facing the industry as it grapples with Solvency II, the FSA’s Mr Sants recognised the significant cost burden the legislation imposes Not only insurers face their own internal cost demands but the FSA will recover an estimated £100m from the industry as a direct result of imposing Solvency II Mr Sants claims the regulator will “continue to work to minimise these costs” but the ABI described the expense of Solvency II as “spiralling upwards and out of control” and the issue still looms large for respondents to the survey Insurers with £500m to £1bn in NWP ranked cost as their biggest concern in implementing the Directive, while all other insurers ranked it as at least a top-three worry While two-fifths of insurers responding to the survey said their budgets were fully signed off until the end of next year, one in 10 insurers had not finalised their total Solvency II cost while just over half (52%) had only partial budgetary approval More non-life insurers (50%) than life (30%) have had full budgetary approval Figure Which of the following best represents the stage of your overall Solvency II budget (to 2012) in the approval process? 7% Deloitte comment – Rick Lester Accurate budgeting for Solvency II has been an ongoing challenge for insurers, regardless of when they began the planning process In part this has been driven by the unique scale of change Solvency II requires, but also the lack of clarity around the final requirements, which remains a top concern for respondents The full cost implications of any large scale change programme are rarely transparent or easily quantifiable in advance This is highlighted in the data, as 12% of all respondents and 36% of larger insurers are still undecided on their total budget This lack of a final decision on overall budget, even at this late stage, may highlight that these insurers are struggling to quantify the full cost implications of their programme Where costs were decided, 20% of respondents expect to spend less than £1m on Solvency II Insurers with NWP below £500m typically expected to spend less than £5m While no insurer in our survey expects to pay over £100m on implementation, 36% of insurers with over £1bn in NWP are still undecided on their total budget Those larger insurers who have decided anticipate spending anywhere between £1m and £75m Life and non-life companies had very similar cost expectations, with the majority expecting to pay less than £10m Figure Which of the following best represents your total budget for Solvency II (including technology spend), approved or otherwise? 52% 41% 2% 3% 0% 3% 0% 12% 20% Budget signed off for part of Solvency II implementation Complete budget signed off to the end of 2012 27% 33% Budget submitted, awaiting approval £0 – £1m £25 – £50m £100m+ £1 – £5m £5 – £10m £50 – £75m £10 – £25m £75 – £100m Not decided Solvency II Survey 2011 Insurers’ responses to evolving rules Commenting on the drivers of cost Mr Zink said: “A massive expense lies in the IT upgrade Obviously it depends on where you start from and how developed the company is internally which determines how much of an upgrade you need.” Figure 10 How many FTE (Full Time Employees) you predict to be involved in delivery of your Solvency II programme at any one time over the course of 2011? % 60 On average, insurers said they needed fewer than 20 full-time employees and that a third of Solvency II preparations and implementation would be undertaken by contractors All respondents have at least 20% of the full-time staff required already in place More than one in 10 (12%) reported that all the requisite full-time staff had been appointed, two thirds of which are the smaller insurers, although this is most likely because they have a smaller number of positions to fill 50 40 30 20 10 0 to 10 2010 Unsurprisingly the largest insurers said they would need the highest amount of full-time employees to deal with the new legislative demands, with a quarter of those with NWP over £5bn and 16% of those with NWP between £1bn and £5bn expecting to dedicate more than 100 personnel to implementing Solvency II 10 to 20 2011 20 to 50 50 to 100 100 plus The right model While all respondents have now decided on whether they will apply for use of a full internal model or partial internal model or stick with the standard formula, a third of respondents have yet to decide whether they need to use proxy methodologies such as curve fitting or replicating portfolios to speed up their liability calculations Almost a third of companies will be using curve fitting, while the replicating portfolio approach proved the least popular as a sole choice for all insurers In fact none of the largest insurers and just one life insurer will use this option alone Over a third of insurers said they will use both approaches When it comes to choice of capital aggregation techniques, there are a number of methods available but nearly one third of all respondents have not chosen a model at this stage Of those insurers which have decided, almost half will be using a simulation-based approach, with 38% opting for ‘Monte Carlo with input copula’ and 9% choosing ‘Monte Carlo with output copula’ (9%) The remaining 23% will be using Risk Geographies or other variance/co-variance techniques Figure 11 Do you plan to undertake a curve fitting or replicating portfolio approach to speed up calculation run-times? 5% Deloitte comment – Roger Simler Companies have spent a large amount of time considering improvements to the capital aggregation techniques typically used as part of internal capital assessment (ICA), with the need to consider non linearity and tail dependency precluding the so called ‘medium bang’ approach for most companies The variety of approaches being taken is indicative of this being a developing area While the early movers have mainly chosen to use a simulation based approach (Monte Carlo with input/output copulas), those who perhaps started later are increasingly looking to less technologically intensive methodologies such as Risk Geographies Whatever method is chosen, most companies will be using some form of proxy modelling technique to speed up the calculations required from their liability projection models This tends to be a relatively complex area, and companies that have not yet determined how best to speed up their calculation would be well advised to press on with this activity An area that is often overlooked is the approach that companies will take to the calibration of their models, with scarcity of data in the tails being one of the factors that should be considered when choosing the aggregation approach 35% 29% 31% Both Not decided Curve fitting Replicating portfolio Figure 12 What is your approach to Economic Capital Aggregation? % 40 35 30 25 20 15 10 Input Copulas with Monte Carlo simulation Not decided Variance/ Co-Variance Output Copulas with Monte Carlo simulation Risk Geographies Solvency II Survey 2011 Insurers’ responses to evolving rules Confidence in compliance There was a drop in confidence that the insurance industry would meet the compliance deadline from last year’s survey with fewer than half of respondents (46%) confident or very confident, compared with 63% last year Greatest confidence in compliance was exhibited by the largest insurers, while organisations with NWP between £300m and £1bn demonstrated the least amount of faith that the industry would hit the final deadline However, respondents showed greater levels of optimism about their own organisations, with nearly three-quarters (73%) saying they were either confident or very confident they would hit the deadline Mr Zink says insurers are willing to all they can to meet the deadline and are dedicating all the requisite resources to the project However, he adds that much of their confidence lies in expectations of flexibility from the regulator “Another element to take into account is whether EIOPA and local regulators are willing to be flexible The ABI still supports the implementation of Solvency II by January 2013 but in our view the current schedule is on the edge of what is practically achievable, in particular with regard to the Internal Model Application Process Some specific provision will have to be introduced for companies participating in the first wave of internal model approval for firms to stand a chance to have more than a handful of models approved by [the deadline],” he says The European Commission has, so far, been pragmatic in its approach to imposing deadlines and has shown its willingness to delay implementation dates by moving the initial November deadline to January 2013 Figure 13 How confident are you that the insurance industry as a whole will be able to achieve compliance with Solvency II by the end of 2012? % 60 50 40 30 20 10 Very confident 2010 10 Confident 2011 Still waiting to make up my mind Concerned Very concerned Not sure Conclusion Clarification from the regulators remains a top concern for survey respondents and, as insurers attempt to prepare for the new regime, the persistent lack of direction continues to throw countless obstacles in their path With one in 10 respondents claiming to be very concerned that the industry will achieve compliance, the EIOPA is under pressure to provide more support to European insurers However, the consultative approach taken means the industry has been given a voice in shaping Solvency II, and insurers must accept this will likely delay the EIOPA in issuing regulatory guidance Insurers must continue to work with the EIOPA and local regulators to mould the new regime and, as they await greater clarity, endeavour to prepare their organisations as effectively as is possible for implementation Figure 14 Which of the following areas are you most concerned about for your business in implementing Solvency II? (Respondents were asked to select and rank three) Sponsorship and engagement Clarification and guidance from the FSA/ECC/EIOPA Interdependencies with other change programmes =3 Resource =3 Cost Internal model approval process =5 Programme structure, governance and delivery =5 Change of regulatory requirements =5 Parallel run requirements Timescales Consistency of approach across Europe Solvency II Survey 2011 Insurers’ responses to evolving rules 11 Deloitte contacts Rick Lester Solvency II Lead Partner 020 7303 2927 rlester@deloitte.co.uk Francesco Nagari Global IFRS Insurance Lead Partner 020 7303 8375 fnagari@deloitte.co.uk Richard Hurley Partner, Technology Consulting 020 7303 8912 rhurley@deloitte.co.uk Roger Simler Partner, Actuarial & Insurance Solutions 020 7303 3292 rsimler@deloitte.co.uk Stephen Ross Partner, Corporate Finance 020 7303 2185 steross@deloitte.co.uk 12 Deloitte refers to one or more of Deloitte Touche Tohmatsu Limited (“DTTL”), a UK private company limited by guarantee, and its network of member firms, each of which is a legally separate and independent entity Please see www.deloitte.co.uk/about for a detailed description of the legal structure of DTTL and its member firms Deloitte LLP is the United Kingdom member firm of DTTL This publication has been written in general terms and therefore cannot be relied on to cover specific situations; application of the principles set out will depend upon the particular circumstances involved and we recommend that you obtain professional advice before acting or refraining from acting on any of the contents of this publication Deloitte LLP would be pleased to advise readers on how to apply the principles set out in this publication to their specific circumstances Deloitte LLP accepts no duty of care or liability for any loss occasioned to any person acting or refraining from action as a result of any material in this publication © 2011 Deloitte LLP All rights reserved Deloitte LLP is a limited liability partnership registered in England and Wales with registered number OC303675 and its registered office at New Street Square, London EC4A 3BZ, United Kingdom Tel: +44 (0) 20 7936 3000 Fax: +44 (0) 20 7583 1198 Designed and produced by The Creative Studio at Deloitte, London 10531A Member of Deloitte Touche Tohmatsu Limited [...]... approach to Economic Capital Aggregation? % 40 35 30 25 20 15 10 5 0 Input Copulas with Monte Carlo simulation Not decided Variance/ Co-Variance Output Copulas with Monte Carlo simulation Risk Geographies Solvency II Survey 2011 Insurers responses to evolving rules 9 Confidence in compliance There was a drop in confidence that the insurance industry would meet the compliance deadline from last year’s survey. .. structure, governance and delivery =5 Change of regulatory requirements =5 Parallel run requirements 6 Timescales 7 Consistency of approach across Europe 8 Solvency II Survey 2011 Insurers responses to evolving rules 11 Deloitte contacts Rick Lester Solvency II Lead Partner 020 7303 2927 rlester@deloitte.co.uk Francesco Nagari Global IFRS Insurance Lead Partner 020 7303 8375 fnagari@deloitte.co.uk Richard... deadline to January 2013 Figure 13 How confident are you that the insurance industry as a whole will be able to achieve compliance with Solvency II by the end of 2012? % 60 50 40 30 20 10 0 Very confident 2010 10 Confident 2011 Still waiting to make up my mind Concerned Very concerned Not sure Conclusion Clarification from the regulators remains a top concern for survey respondents and, as insurers. .. attempt to prepare for the new regime, the persistent lack of direction continues to throw countless obstacles in their path With one in 10 respondents claiming to be very concerned that the industry will achieve compliance, the EIOPA is under pressure to provide more support to European insurers However, the consultative approach taken means the industry has been given a voice in shaping Solvency II, ... meet the deadline and are dedicating all the requisite resources to the project However, he adds that much of their confidence lies in expectations of flexibility from the regulator “Another element to take into account is whether EIOPA and local regulators are willing to be flexible The ABI still supports the implementation of Solvency II by 1 January 2013 but in our view the current schedule is on... consultative approach taken means the industry has been given a voice in shaping Solvency II, and insurers must accept this will likely delay the EIOPA in issuing regulatory guidance Insurers must continue to work with the EIOPA and local regulators to mould the new regime and, as they await greater clarity, endeavour to prepare their organisations as effectively as is possible for implementation Figure 14... regard to the Internal Model Application Process Some specific provision will have to be introduced for companies participating in the first wave of internal model approval for firms to stand a chance to have more than a handful of models approved by [the deadline],” he says The European Commission has, so far, been pragmatic in its approach to imposing deadlines and has shown its willingness to delay... formula, a third of respondents have yet to decide whether they need to use proxy methodologies such as curve fitting or replicating portfolios to speed up their liability calculations Almost a third of companies will be using curve fitting, while the replicating portfolio approach proved the least popular as a sole choice for all insurers In fact none of the largest insurers and just one life insurer will... variance/co-variance techniques Figure 11 Do you plan to undertake a curve fitting or replicating portfolio approach to speed up calculation run-times? 5% Deloitte comment – Roger Simler Companies have spent a large amount of time considering improvements to the capital aggregation techniques typically used as part of internal capital assessment (ICA), with the need to consider non linearity and tail dependency... insurers, while organisations with NWP between £300m and £1bn demonstrated the least amount of faith that the industry would hit the final deadline However, respondents showed greater levels of optimism about their own organisations, with nearly three-quarters (73%) saying they were either confident or very confident they would hit the deadline Mr Zink says insurers are willing to do all they can to ... composite respondents had plans to so Solvency II Survey 2011 Insurers responses to evolving rules Aligning interest Not content with introducing Solvency II, European legislators are also focusing on... No structured programme Tailored training for all impacted by Solvency II Solvency II Survey 2011 Insurers responses to evolving rules Future focus Figure Which of the following areas will your... discuss any aspect of this report Rick Lester Solvency II Lead Partner rlester@deloitte.co.uk Solvency II Survey 2011 Insurers responses to evolving rules Introduction The European insurance industry