Editorial & Advertiser Disclosure Global Banking And Finance Review is an independent publisher which offers News, information, Analysis, Opinion, Press Releases, Reviews, Research reports covering various economies, industries, products, services and companies. The content available on globalbankingandfinance.com is sourced by a mixture of different methods which is not limited to content produced and supplied by various staff writers, journalists, freelancers, individuals, organizations, companies, PR agencies Sponsored Posts etc. The information available on this website is purely for educational and informational purposes only. We cannot guarantee the accuracy or applicability of any of the information provided at globalbankingandfinance.com with respect to your individual or personal circumstances. Please seek professional advice from a qualified professional before making any financial decisions. Globalbankingandfinance.com also links to various third party websites and we cannot guarantee the accuracy or applicability of the information provided by third party websites. Links from various articles on our site to third party websites are a mixture of non-sponsored links and sponsored links. Only a very small fraction of the links which point to external websites are affiliate links. Some of the links which you may click on our website may link to various products and services from our partners who may compensate us if you buy a service or product or fill a form or install an app. This will not incur additional cost to you. A very few articles on our website are sponsored posts or paid advertorials. These are marked as sponsored posts at the bottom of each post. For avoidance of any doubts and to make it easier for you to differentiate sponsored or non-sponsored articles or links, you may consider all articles on our site or all links to external websites as sponsored . Please note that some of the services or products which we talk about carry a high level of risk and may not be suitable for everyone. These may be complex services or products and we request the readers to consider this purely from an educational standpoint. The information provided on this website is general in nature. Global Banking & Finance Review expressly disclaims any liability without any limitation which may arise directly or indirectly from the use of such information.


Robert Gothan, CEO and founder of Accountagility – the leading solutions provider for the finance function

Businesses in every sector have been experiencing a prolonged period of uncertainty since the UK’s decision to leave the EU on 23rd June 2016, not least those in the insurance industry, whose regulatory requirements are largely governed by directives and legislation coming out of the EU.

This level of uncertainty looks set to continue, with the High Court’s recent ruling that MPs are permitted to vote on the referendum and no set date as to when Article 50 will be triggered. For businesses in the UK, this means an even longer wait before any plans to leave the EU officially are put into action, and equally troubling uncertainties as to the short, medium and long term financial plans for their business.

With the news agenda on the effects of Brexit still altering on a weekly, if not daily basis, organisations in the insurance industry must be able to factor any new information into their planning documents as a regular occurrence. Many firms are still struggling with legacy systems, however, and are unable to amend the data in these plans at the speed necessary for effective, forward-looking plans.

The impact on Solvency II

Changes to legislation are a common occurrence in the financial services sector, with new rules and requirements being introduced on a regular basis. One of these more prominent directives is Solvency II, a policy that was designed to regulate the amount of capital that insurance firms must hold to reduce the risk of insolvency.

When it was first introduced, this directive was welcomed by the insurance industry and firms in the UK even had an active role in its introduction. Over the past 12 months however, support for the regulation has decreased, with Grant Thornton finding that only 17% of insurance firms believe the directive has been worth the effort.

As a result of the referendum, the Treasury Select Committee is now conducting an inquiry into the future of Solvency II in a post-Brexit landscape. Given the sheer level of investment into this directive from a technological, financial and resource perspective, it is unsurprising that firms are not necessarily seeing the benefits to the business.

Planning for the post-Brexit landscape

Planning tools that are agile enough to cope with vast and fluctuating amounts of data, as well asany changes to regulatory requirements, will be crucial for firms in the insurance sector going forward. Post-Brexit planning is a long process which will require several scenarios to be dealt with and changed simultaneously in the same document, and as a result, using tools such as Excel will not be adequate.

For insurance firms writing business across several different countries and currencies, accounting for fluctuations in exchange rates has always been a crucial part of their planning systems, and this will have only increased following the referendum. With Brexit triggering a weak Sterling and most recently, the US election result leading to market volatility, the importance of planning and monitoring forex has never been greater. By adopting an agile planning tool, however, firms will be able to forecast for movements in the exchange rates of different currencies more easily and also change plans quickly in response to any sudden fluctuations.

Whilst it remains to be seen what changes will be made to Solvency II, and what the future holds for the stability of the world’s economic markets, insurance firms need to incorporate planning tools that will meet the needs of the business both now and in the future. It is inevitable that further legislation will be introduced into the insurance sector in the future, regardless of what happens to Solvency II. When this happens, it will be the firms that have updated their planning tools and their technology that will be the best prepared for the changes that come their way.