A small window of opportunity remains to understand synergies between Solvency II and other organizational objectives, and to adapt existing programs to harness these synergies. Insurers should begin to think about what happens after 31 December 2012 now.
Poor quality data has the capacity to undermine the integrity of an organization's technical reserves and internal models, and the potential to derail compliance by 31 December 2012.
Detailed planning and prioritization is essential to make the best use of the short time remaining and to promote a pragmatic approach that targets the most material data.
Organizations should focus relentlessly on the areas most important to success, such as:
- Establishing source and lineage of key data
- Implementing data-ownership
- Building robust business rules and data quality metrics.
These requirements should be applied on a prioritized basis to the most critical data ﬁrst.
For non-life insurers:
We would encourage non-life insurers to focus particularly on non-ﬁnancial data used in catastrophe modeling and large loss data.
For life insurers:
Recent QIS processes have highlighted asset data granularity and availability as the key challenges.
Deficiency evaluation and remediation planning should be accelerated, as data quality remediation is increasingly becoming the elephant in the room for many Solvency II programs and could require significant additional budget considerations and resources.
Given the time pressure on Solvency II programs, it is important that insurers continue to adopt a pragmatic approach to Solvency II data quality between now and the regulatory deadline. However, organizations should also consider the broader change agenda, including IFRS 4 Phase II and the evolution of enterprise data architecture management.