Insurers fear industry will miss deadline
MORE than a third of UK insurers fear the industry will miss the deadline to comply with the forthcoming Solvency II reforms, according to research carried out for Deloitte by the Economist Intelligence Unit.
Insurers also said uncertainty over the final draft of the EU directive – which will lift capital requirements – has increased costs.
Rick Lester, lead Solvency II partner at Deloitte, said that despite delaying the implementation date until January 2014, firms were less confident that it would be met.
“There has been a 50 per cent increase from last year in the number of respondents who have expressed concern with the industry’s ability to meet the compliance deadline,” he said.
Lester added that the primary concern of insurers was the lack of detailed information on Solvency II requirements since they “are unlikely to be clarified until relatively close to the go-live date”, creating additional costs.
The delays are affecting profits, with 73 per cent of respondents saying setbacks have taken a toll on budgets. Meanwhile 42 per cent said Solvency II delays have increased programme costs by more than five per cent.