IFRS Insurance and Solvency IIThe opportunities and challenges that you, as an Insurers should grasp |
There are a number of opportunities and challenges that you, as an insurer, should want to grasp in the context of the new IFRS Insurance rules
- The new IFRS Insurance requirements introduce an unprecedented level of non-discretionary efforts impacting finance and with extensive ramifications across the entire insurance enterprise. This situation offers the opportunity to identify and seize benefits in addition to the implementation of a fully compliant financial reporting infrastructure.
- Insurers face the challenge of balancing mandated change with cost containment and benefit realization. The overlap of Solvency II and IFRS Insurance requirements presents Strategic Synergy Benefits (SSBs) to insurers which are capable of seizing them.
- Deloitte UK Partner, Francesco Nagari, observed that insurers that addressed the operational impacts arising from the change brought about by Solvency II are ideally placed to prepare for the implementation of IFRS Insurance requirements and create a sustainable infrastructure capable of dealing with both set of requirements at the same time. The journey to seize SSBs must start now if a low overall implementation risk is desired.
- A low risk implementation strategy ensures that an insurer’s Operating Model adapts to these sequential and often overlapping material changes in an efficient, effective and sustainable manner
- The Solvency II and IFRS Insurance regulations have evolved in late 2012 from a clear sequential scenario to a more complex timetable with major IFRS changes occurring before and after the expected Solvency II effective date "A Target Operating Model" challenge is to create the right framework to enable the realization of the SSBs
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