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Solvency II data requirements spark fund concerns

Solvency II data requirements spark fund concerns

Solvency II is set to place heavy administrative burdens on fund managers as well as insurers, Martha Whitman has warned.

The head of insurance solutions for Europe, Middle East & Africa at State Street said industry professionals have raised concerns about the level of detailed data their insurance clients will require under the European regulations due to come into effect in January 2016.

She said: “When our clients think of Solvency II they focus on the issues facing insurers, but the challenges can be just as demanding for the fund managers who manage their investments.

“The level of reporting and transparency required is significant. We have seen a growing number of fund managers, in addition to insurers, approach us to help address the administration burden.”

More than one in three insurance professionals and fund managers believe asset management companies are unprepared for the requirements of Solvency II, according to State Street research.

The survey of 100 industry insiders found that even if fund managers could provide the level of data required, 41 believe they would struggle to do so in a timely fashion.

Overall, 68 per cent of insurance executive and fund managers surveyed believe that the pressure of Solvency II on insurers would lead to them placing a greater focus on investment strategies that provide more predictable and uncorrelated returns.

Adviser view

Colin Parkin, managing director of Lincolnshire-based Ample Financial Services, said: “Solvency II is certainly going to place more demands on the sector and I think people will have to put resources into this to get everything done in time.”

Email: damian.fantato@ft.com