UK insurers stall on EU Solvency II directive
~ EMB highlights that four out of five UK insurers are yet to commence training staff in the directive ~
Research published today by actuarial and business consultancy EMB has highlighted low levels of preparation across the UK’s insurance industry for Europe’s upcoming Solvency II directive. The study has discovered that only 18 per cent of insurance companies are providing professional training tailored to Solvency II, with 14 per cent unaware if they are offering training or not.
The Solvency II directive, which covers more than 30 countries in the European Union and European Economic Area, is due to be implemented by 2012 and aims to establish principles-based regulation across the European insurance sector. It is the biggest ever exercise in bringing together insurers and reinsurers under one regulatory regime.
“Since the UK insurance industry already has principles-based regulation in the form of ICAS, there may be some complacency about Solvency II. That’s a mistake in our view, particularly because the Financial Services Authority has now set out a timetable to try to ensure a smooth implementation in the UK,” said EMB Partner, Richard Rodriguez. “The insurance industry needs to see this directive as an opportunity to improve business practices, and experience the associated benefits, rather than a box-ticking exercise. To prepare for this directive they need to engage staff at all levels of the organisation, which includes offering professional, customised training.”
The research also highlighted the main factors that drive staff training, with 64 per cent of respondents stating increases in regulation as a driver and 58 per cent suggesting the increasing needs of a global market.
“Our industry has obviously identified that developments such as Solvency II require an investment in training, yet doesn’t seem to be taking action. There is a widening skills gap across our industry which can only hinder companies’ ability to reap the potential business benefits from Solvency II,” concluded Richard Rodriguez.