The decommissioning of T4U, as well as the move of excel based solutions to business as usual, provides regulatory compliance leaders an opportunity to reassess cost effective alternatives for generating their Solvency II Pillar 3 reports. Outlined below are the key elements insurers currently using excel based solutions should consider when deciding how to deliver their regulatory reports going forward.
1. Need to automate
Increasing automation in regulatory reporting is a must for insurers. Through streamlining of process and reducing the dependency on manual activities, insurers should look at reducing their ongoing Solvency II reporting costs by up to 40% with an additional benefit of reduced operational risk
2. Tighter reporting deadlines
Quarterly reporting deadlines are tight; seven weeks after quarter-end in 2017, accelerating to five weeks by 2019. Insurers need to look at enterprise solutions capable of meeting these reducing deadlines while also limiting their costs over the long term.
3. Managing regulatory change
Insurers must manage change in relation to changing taxonomies. There are associated costs if insurers plan to develop an in-house, centralised model. A logical alternative is software that is future proofed and any changes in regulation are included as part of that solution.
4. Interpretation of requirements
With changing taxonomies and frequent updates from EIOPA, endeavouring to interpret exactly what data will be required for each QRT will pose difficulties. Access to a team of locally based Solvency II reporting specialists will help simplify the process.
5. Increased data requirements
Pillar 3 reports require regular processing of significant amounts of quantitative and qualitative data from multiple internal and external sources. Insurers are looking towards their existing solutions to deal with this complex data and to automate the overall production of deliverables.
6. Audit trail
Auditability should be incorporated into every step of the reporting process and this is not always possible with manual solutions. To ensure audit-proof tracking, insurers need a solution that logs all actions from manual changes of reported data to sign-off.
7. Regulatory-as-a-Service (RaaS)
Regulatory reporting is not a market differentiator so why have some of your best people wrapped up in this on a quarterly basis. RaaS allows insurers to comply with all relevant rules and regulations in an efficient and full serviced offering.
At BearingPoint, we have already assisted clients in moving away from T4U or excel based solutions onto a proven long-term Solvency II solution. If you would like further information please get in touch: gary.mullane@bearingpoint.com
