PwC comments on EIOPA’s launch of a public consultation on its revised proposals for reporting under Solvency II. These proposals define the content and format of insurers' Solvency II reporting both on a private basis to their supervisors and for public reporting to all stakeholders. This represents an important milestone in the development of the Solvency II regime.
Jim Bichard, insurance partner at PwC, said:
“To date, Solvency II reporting has tended to take a back seat to capital evaluation and risk management work streams for many European insurers due to the uncertainty around the requirements. EIOPA's publication removes some of this uncertainty and allows insurers to accelerate their implementation plans.
“The amount of work required should not be underestimated, as Solvency II reporting will be much more detailed and exhaustive compared to current requirements. Insurers should see this consultation, and the additional clarity it provides, as the much-needed trigger to get their reporting workstreams on track.
“The consultation is far more detailed than the last public consultation and demonstrates the size of the task at hand for insurance companies in meeting the extensive disclosures required under the new regime. The reporting requirements have already been subject to public and private consultations and so, in most areas, we would not expect the final requirements to differ materially from those set out by EIOPA today. However, insurers need to be aware that the requirements could be supplemented by further reporting requirements for financial stability purposes or to deal with country-specific obligations.
“The biggest challenge for most insurers will be the requirement to report to the regulator on a more frequent basis and in some areas to report information that has not previously been needed. Finance functions will need to re-think their target operating model to enable faster reporting and enhanced integration with actuarial, risk and other departments.”
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