Regulatory Framework in the Insurance Industry – The Solvency II Project

Insurance is of fundamental importance to both individuals and business because replaces insecurity with security and stability. The protection provided by insurance and the investments made by insurers contribute to economic growth and structural development. The role of public authorities is to provide an adequate regulatory framework allowing consumers to benefit from product innovation and to be protected. The study gives a brief review of the development of the insurance risk-management concept, analysis the goals and design of the Solvency II project and the solvency capital requirement formula according to the new regulation. In the end the results of the quantitative impact studies on the insurance industry are discussed.