Insurance Industry EU: Solvency II details of the Directive currently under preparation in the EU are expected to be implemented by 2010
In an article for Insurance Day, Swiss Re economists Patrizia Baur and Rudolf Enz explain how the shift from uniform to risk-adequate capital charges will affect different lines of insurance based on their volatility and catastrophe exposure. They also discuss stricter assessment and capital requirements for additional product features such as options to waive premiums and investment guarantees. The article concludes that Solvency II will benefit both policyholders and insurers by reinforcing the focus on the fundamentals of risk and return.
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