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Speaking at Insurance Risk's Solvency II and Insurance Risk conference in London, Buecheler said much of the industry focus had been on the calibration of the Solvency II rules, but noted that the internal model approval process had not yet been tested – and plenty of ambiguity exists over what regulators will require.
Timing is another area of difference. Buecheler told the audience that one supervisor had requested that all the supporting documentation for internal model approval be ready by March 2013 – three months before the scheduled date for applications to be submitted. However, another had stipulated they would only begin reviewing applications once the June 2013 deadline had passed.
More broadly, legislators have suggested implementation of Solvency II will be delayed beyond the scheduled 2014 start date, but regulators have stated they will work on the basis of the existing timeline until they have official confirmation of any delay. Buecheler said he would prefer legislators to take longer drawing up the regulations if it leads to better quality rules.
"We still have a euro crisis, so implementing Solvency II and all the implications and thinking about all the implications, at this point in time, is a challenge in itself. And that basically brings me to the punch line, where we really say, from Allianz's perspective, we prefer fit for purpose, which might take a bit longer. So we believe ill-defined Solvency II regulation and legislation could do more harm, especially at this point in time, than if we took a bit more time and possibly run under a parallel calculation scenario between Solvency I and Solvency II for some time, and then really come out with something at the end that makes sense and that has proven its quality, even in such a stress situation", he said.
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