Solvency II Impact on the Romanian Insurance Industry

Abstract

The article provides a quantitative evaluation in which is investigated the impact of the Solvency II on the Romanian insurance industry after three years of the implementation of the new insurance regulatory framework. The impact assessment was performed based on the main prudential indicators concerning the capital requirements (SCR and MCR) and Own Founds before and after Solvency II application. The analysis results shown that the new regulatory regime had a positive impact on the solvency position of the Romanian insurance industry. At individual level, after three years since the new framework became effective, all insurance companies that carrying out business on the local market have complied the regulatory capital requirements. Moreover can be observed a capital optimization trend among Romanian insurance companies. The aggregated structure of the eligible own funds to cover capital requirements shown a high quality of capitalization which indicates a sufficient absorbing capacity of losses.

Keywords

• solvency ii
• romanian insurance industry
• scr
• mcr