Solvency II delay may slow insurers' enterprise risk management efforts
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The delay in the implementation date for Solvency II may slow European insurers' efforts to improve their enterprise risk management, Standard & Poor's Ratings Service Ltd. said in a report released Monday.
European Commissioner Michel Barnier announced this month that the start date for the set of risk-based capital rules for insurers and reinsurers in Europe would be delayed two years to Jan. 1, 2016.
But S&P said that could delay insurers' ERM efforts.
“Solvency II remains a major driver for ERM improvements in Europe,” Miroslav Petkov, a credit analyst at S&P in London, said in a statement.
He said that S&P believes that the true value of ERM is it enables companies to more effectively manage their business, not simply because it is a regulatory requirement.
In the report, “Will Insurers' ERM Developments Continue Without a Solvency II Push?” the rating agency said some insurers slow their adoption of ERM because of delays in implementing the risk-based capital rules.
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