Solvency II will test insurers 2008 results, AM Best

The recent crisis in financial markets provides a real-life stress-test scenario for insurers preparing for new Solvency II rules, said AM Best in a new report on Europe’s proposals for a risk-based solvency regime. The rating agency firm said while most insurers met the minimum capital requirements as specified in the most recent impact study, the results are based on 2007 financial results and the effect of recent events could produce different results if based on 2008 financial performance. Only 10% of firms in the QIS 4 exercise conducted by Ceiops met the solvency capital requirement, AM Best said.