As part of the Allianz SE group, Allianz Insurance has received regulatory approval to implement an internal model to calculate capital requirements under Solvency II.
Solvency II, which is EU legislation intended to strengthen the capital and risk regulation of insurance companies, will take effect on January 1, 2016. The legislation will allow insurers to apply for approval to use their own internal model for capital assessment, instead of a standard formula.
Allianz’s internal model has now passed rigorous testing by the German Financial Supervisory Authority (BaFin) as Group supervisor, the Prudential Regulation Authority (PRA) as UK supervisor and other EU regulators included in the Allianz supervisory college. This will allow Allianz to use the model for calculation of Solvency II capital requirements in major European markets, including in the UK, from the start of 2016.
Jon Dye, chief executive officer, Allianz Insurance, commented: “We are delighted to win regulatory approval of our internal model and believe this is a key milestone for Allianz, reflecting a very strong foundation for the future. We have been through a very detailed approval process and our success in the UK is down to the expertise and dedication of our people. Many congratulations to the wide team at Allianz who have achieved this outcome.”
Stephen Wilcox, chief risk officer, said, “We believe our internal model will better reflect our conservative risk appetite compared with the standard model that less sophisticated firms will use. Combined with our strong technical capabilities, we are confident the changes will allow us to better manage our business and will deliver a distinct advantage against our competitors. ”
Allianz Insurance is one of the largest general insurers in the UK and part of the Allianz SE Group, the largest property and casualty insurer worldwide.
Around 85 million private and corporate customers rely on Allianz's knowledge, global reach, capital strength and solidity to help them make the most of financial opportunities and to avoid and safeguard themselves against risks. In 2014, over 147,000 employees in more than 70 countries achieved total revenues of approximately 122.3bn euros.