The German life insurance sector will be able to cope with the transition to the capital requirements stipulated by the European Solvency II supervisory regime despite the significant drop in interest rates.
As expected, one significant finding of the first "Vollerhebung Leben" survey was confirmed: the transitional measures and volatility adjustment stipulated in Solvency II regime are achieving the desired effects. Because of the use of these instruments, almost all life insurance undertakings showed the required level of own funds as at 31 December 2014. The number of undertakings unable to demonstrate that they had sufficient own funds despite having used these instruments has not increased compared with the last survey. BaFin is staying in close contact with those insurance undertakings that show signs of possible difficulties at the launch of Solvency II.
Full press release
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