Solvency II – Potential Delays

Since the Treaty of Lisbon, Solvency II has been modified adding more complexity to the process. Not only is the substance of Regulation still under review but also the existing procedures embedded in the Lamfalussy process have had to be revised and rewritten. Solvency II was originally constructed around the 4 level Lamfalussy process.

• A Directive detailing what was to be covered by Regulation
• The Regulation
• Guidelines on how to apply the Regulation
• The monitoring of the Regulation

The effect of this is to create uncertainty around the proposed date that Solvency II will implement – currently this is proposed to be 1st January 2015 or even 1st January 2016 .

There has been much talk about both a soft launch to allow firms that are far advanced in preparation to be able to report capital positions on a Solvency II basis. However there is still uncertainty around what will be contained in the final version of the Regulation.

Unrealistic target times are have resulted in delay, as the Directive that sets up Solvency II is not scheduled to be passed by the European Parliament at least before February 2012 and none of the Regulations, Technical Standards or Guidelines emerging from this can be officially published or consulted on prior to this.