This year will be a busy year for the insurance industry as it makes sure it is fully compliant with Solvency II regulations by January 2016 - and for some insurers it will be a case of deciding whether to withdraw from an entire class of business or a territory. Not a trivial decision.
We all live the experience of floating adrift on the Pivot Sea, casting our data connections out from Excel hoping to have a hit of the “big one” – now sometimes called ‘big data’ – the table, the query, the info we want that delivers that insight, those nuggets, that we so desperately want.
An increasing number of businesses are now seeking to move away from traditional on-premise solutions for corporate performance management (CPM). A 2014 survey entitled “Empowering Modern Finance” carried out by Longitude Research on behalf of Accenture and Oracle, says that more than two-thirds of executives have adopted a cloud-based system for core financials (24%), or are planning to do so (45%).
The EU Solvency II Directive (the insurance industry equivalent of Basel II for banks) seeks to harmonise EU insurance regulation and protect the public by reducing the risk of insolvency. Affected EU direct life and non-life insurance and reinsurance companies will, effective as of 1st January 2016, be governed as to the amount of capital that the company must hold.
The responsibilities and pressures on the CFO are great; the regulatory environment is high, as is scrutiny from investors who are looking for details that go beyond the numbers. The CFO has become a key strategic role – one that is often the coordinating point across departments.
Go back just 5 years and you will find that businesses were faced with a stark choice in the cloud versus ‘on-premise’ debate. Cloud computing in the financial applications space was the preserve of newly formed software vendors with little or no track record. The functionality was relatively primitive and although the cloud had its attractions, conservative finance organisations were reluctant to venture into uncharted waters.