<![CDATA[Data and data quality are central to the new Solvency II regulation. An event hosted by IBM at the Institute of Directors in London last week shed light on what that means in practice. Both the regulator and insurers are spending significant sums on implementing Solvency II. The FSA plans to spend £20m on Solvency II regulation in 2011, according to Martin Shaw, Chief Executive of the Association of Financial Mutuals, who presented an overview of progress to date. The amount is triple what the FSA spent last year. “If that is how much the regulator is spending,” said Mr Shaw, “we can assume that firms will be spending a lot more.” Some in the industry estimate the cost of compliance for the larger UK insurers above £200m, with as much as 65% of spending allocated to technology. This high portion allocated to technology is not surprising perhaps, given the reporting burden under the regulation. Insurers will have to produce five reports per year, four quarterly reports and an annual report. The first report is due with the regulator on 14 April 2013 – less than two years away. But like the proverbial elephant on the horizon, the deadline is deceptively close. Firms will want to produce at least a few dry runs before the first submission. And, according to Mr Smith, they will eventually want to move to daily risk reporting, which will increase the reporting burden.
2 thoughts on “Data quality for Solvency II – ignore it and get left behind”
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