EIOPA’s new risk dashboard for the first time based on the Solvency II Data

27 February 2017

The European Insurance and Occupational Pensions Authority (EIOPA) published for the first time after the implementation of the new Solvency II regime its new risk dashboard.

Although Solvency II implied a major change in the methodological framework for the calculation of the solvency capital requirements, the initial transition to the new regime was smooth. The results for the third-quarter 2016 show that the low-yield environment and market risks continue to be a major challenge for the European insurance sector.

The new EIOPA risk dashboard is based on an extended sample of undertakings and on an improved methodological approach.

Key observations are:

• Since the last publication of the EIOPA risk dashboard, several important political events have taken place which have contributed to a lot of political uncertainty. Impacts on the financial markets are not always in line with expectations. Meanwhile, the low-yield environment continues to be a major challenge for the European insurance sector. Combined with the still on-going expansionary monetary policy of several central banks, these observations resulted in a high macro risk evaluation.
• In the beginning of 2016, Solvency II, the new prudential regime for insurance companies, was introduced in Europe. Despite the regime implying a major change in the way insurance companies have to set up their balance sheet and calculate their solvency capital requirements, the initial transition has been rather smooth resulting in a stable median risk score for the profitability & solvency risk category.

Full risk dashboarad

Background note

© EIOPA