How not to Get Lost in the Regulatory Jungle

Have ever felt that today’s financial industry is challenged by an increasing regulatory and reporting requirements? That insurance industry is heading the same direction? (You are probably thinking of Solvency II now).

Solvency II regime demands an insight into significant amounts of company data on a very granulate level. This means that every insurance business is challenged to store big (including historical) data sets at a very detailed level at the same time ensuring the accuracy and consistency of the information.

Collecting, monitoring, managing and reporting all the required information can quickly lead to a sharp increase in financial and time costs as data often has to be gathered from different systems at possibly different levels of data quality. In addition, it is not uncommon that the reported data has to be presented in a strictly defined technical format. For the information to comply with the regulatory requirements companies would use either an increased amount of human resources for data transformation, quality and consistency check or such resources would be reallocated from daily business reducing capacity in a company’s vital area of activities. Such process if performed rather manually would often be described also by low efficiency.

 

Regulatory Reporting 

Solution for reduction of the burden imposed by new and/or manual processes an insurance business could be a single platform for data gathering and storage which would lead to an increased efficiency: the resources and efforts used for data collecting and reconciliation could be instead allocated to data analysis and business improvement. Criteria priority for choosing such a single-platform solution could vary from company to company but in many cases it should be a combination of evaluation of:

  • Credibility of the supplier
  • Match between a company’s existing IT architecture and that of the new solution
  • Total functionality of the solution as well as user-friendliness
  • Total implementation costs
  • Flexibility of the supplier in accommodating company-specific needs (within an existing technical solution)

The right choice would not only increase the quality and efficiency of the data collection and reporting process but would also save from a fair share of frustration.

 

Solvency II Compliance

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