Solvency II: Optimizing your Required Solvency Margin
Solvency II requires a risk management system embedded throughout an organization to control the risks related to the business processes of an insurer to protect investments. A process-based risk program provides a stable basis for all other risk management programs like credit, market and liquidity risk. Developing such a program is a time consuming project; the involvement of the entire business is required and the framework needs to be developed following evolving regulatory requirements. Most insurance companies have already implemented a quantitative risk management system under Solvency Pillar 1 requirements, but a process-based approach is a good solution to the requirements under Pillar 2.
Risk management framework Pillar 2 of Solvency II describes on a high level what the framework must look like, and because each organization has its own unique business processes with unique related risks, it needs to build its own risk management framework. Building this system demands a change in work processes and a risk-based awareness of the business, especially in regards to the processes of each department in the organization.
Get in control of your organization: with BWise, understand your processes, monitor your incidents and manage your risks
Identify risks, realize transparency Based on best practices, BWise has developed a new approach for developing and embedding the required risk management system for Solvency II compliance. Based on this experience, BWise has developed capabilities within the BWise solution to help organizations get business managers and employees involved; to help them identify risks, to realize transparency and to embed the GRC framework into the organization. You can find more information in the BWise Solvency II Solution Sheet.
Benefits By using the BWise solution, insurers will be able to identify potential business process improvements and create in-depth reports for management. Eventually, BWise will help insurance companies to comply with Solvency II and to prove to regulators that they are truly in control of their risks. This will result in the optimal required solvency margin.
BWise, founded in 1994, has many years of experience in implementing internal control and risk management systems for insurance companies.
