WTW warns against further UK regulatory upheaval post Brexit

UK re/insurers have “little appetite” for any further regulatory upheaval having already invested to much in implementing the regulatory regime Solvency II, Willis Towers Watson (WTW) has warned.

WTW has responded to the UK Government’s call for evidence on its review of Solvency II. With the Brexit transition period now expired, HM Treasury is considering areas of Solvency II that could better reflect the particular structures, products and business models of the UK insurance sector.

WTW said it supports the stated objectives of HM Treasury’s review, which are to make sure that the UK’s future regulatory regime supports an internationally competitive insurance sector, protects policyholders and supports insurance firms to provide long-term capital to support growth.

But it also stressed that any changes should be limited to aspects of Solvency II that are poorly designed or imperfectly calibrated for the UK.

Kenny McIvor, a Director in Willis Towers Watson’s Insurance Consulting and Technology business, said: “There is little appetite for significant upheaval given how much UK re/insurers have already invested in implementing the regulatory regime. Instead, changes should be targeted at aspects of Solvency II that are poorly designed or imperfectly calibrated for the UK. Essentially, any reforms should also meet the needs of three main stakeholders: consumers, capital providers and government working on behalf of society.”

McIvor added: “Our response is based both on Willis Towers Watson’s role as an advisor and as a leading provider of actuarial technology and actuarial outsourcing. The latter of these responsibilities puts us in the unique position of having to implement regulatory requirements ourselves, meaning we have a direct insight into the needs and interests of our insurance clients.

“We believe that our recommendations to improve the prudential regulatory framework will help the UK Government meet its objectives, and will ensure that the rules are appropriately tailored for the UK re/insurance market.”

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