It is necessary to provide the supervisor of more human and economic resources
In the wake of the recent application of the Solvency II Directive, the IE organized an exclusive meeting for insurance industry managers on the theme ‘The Impact of New Regulation on Insurance Company Management and Strategy’.
Insurance companies have been implementing the application of the new directive since January 1st, 2016. The European regulations are designed to make financial stability in the industry more solid, using improved risk control and better governance policies as a foundation to achieve this.
The IE analyzed the challenges and opportunities in the insurance industry emerging from the new regulatory conditions in a meeting sponsored by SCOR Global P&C and Clifford Chance. The conference benefitted from the participation of some of the most respected figures in the sector. The roundtable discussion was moderated by Jaime Velázquez (Managing Partner of Clifford Chance) and other highly regarded contributors included María Nuche (Solvency Deputy General Director of the DGSYFP); Carlos Montalvo (Executive Director of EIOPA); Pilar González de Frutos (Chairwoman of UNESPA), and Ricardo Martínez Galán (Managing Partner of D.A. Defensor). These influential industry figures shared their strategic vision for the process of adaptation to the changes in the regulatory environment.
Carlos Montalvo defended the need for these new regulations and pointed out that Spain is the country with the best information and the best quality and information in the reporting of data to Europe. Carlos highlighted the “opportunity these changes represent for insurance companies, providing a chance to better explain who they are, what they do and precisely how they generate value for the Spanish economy”. Furthermore, he outlined other challenges the industry needs to face, such as the low interest rate environment, the adaptation to new technology or the appearance of so-called ‘millennials’, the latest customer profile to appear in the market.
Pilar González Frutos pointed out that one of the most challenging tasks in the adaptation to new technology is the demanding nature of the current environment, not only for its professionals and businesses, but also for those in charge of the supervision of the Spanish sector. Pilar pointed out the need to provide more resources for this work, as well as the requirement to work towards legislation that is more comprehensive and finely tuned to the regulations of the sector and the most widespread products, for both insurance companies and mutual insurers.
Finance Professor Laura Núñez took advantage of the opportunity presented by the seminar to announce the IE University initiative to create an insurance sector research center. The project is already underway and has been developed on a foundation of independence, scientific rigor and relevance for the industry. The project has the double objective of enriching the insurance industry through the creation of know-how and in order to improve its functioning, while, at the same time transmitting its findings to the insurance consumer, as well as to society in general.
The conference was opened by Santiago Íñiguez, Dean of the IE and closed by Guillermo de la Dehesa, President of the Governing Council of the IE Business School and expert in the insurance industry. Guillermo pointed out the difficulty that sector Boards of Directors occasionally have when it comes to comprehensively understanding the internal risk management models that many companies are implementing, given their complexity, and that the regulations will bring about a notable reduction in the overall number of insurance companies.