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Grant Thornton comments on the results of Solvency II's QIS4

Leading financial and business advisers, Grant Thornton, comment that the results of the fourth quantitative impact study (QIS4) into Solvency II show that there will be no major impact on the balance sheets of insurance companies. In general, an increase in the capital requirements will be offset by a decrease in the level of insurance liabilities.

"The results show that the vast majority of companies participating in the study will meet both the minimum and the solvency capital requirements. However more detailed technical definitions are still required in a number of areas, including future premiums, valuation of options and guarantees, calculation of future discretionary benefits, calculation of net technical provisions and the choice between 'own data' and 'market data'," says Sheaf.

"The participation rate of this study was the highest to date, clearly indicating that the industry is taking Solvency II seriously and contributing significant resources and effort. Yet, there is still a great deal of clarification needed. Based on the need for more detailed technical information, it is clear that further work is necessary and this may well take the form of another quantitative impact study."