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Solvency II -The Practicalities Around Programme Governance & Data
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Solvency II -The Practicalities Around Programme Governance & Data


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This was the Gain-Line presentation at the ILAG Solvency II Workshop

This was the Gain-Line presentation at the ILAG Solvency II Workshop

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  • 1. Solvency II The Practicalities Around Programme Governance & Data
  • 2. Gain-Line & Solvency II Solvency II is the biggest ever exercise in bringing together insurers and re-insurers under one regulatory regime. Solvency II Programme Slide
    • Solvency II is a set of principles and guidelines leading to best practice in risk management;
    • It is an Enterprise-Wide initiative that will impact all areas of the business;
    • Early adopters are helping the FSA set the bar for what is required in the Market;
    • The range and diversity of insurance operations means that a Solvency II solution will vary from company to company;
    • Numerous approaches are being adopted across the market and it not a case of one size fits all ;
    • The eventual solution in each case will depend on a range of inputs from a number of different disciplines.
  • 3. Who Are Gain-Line The Gain-Line Group is a consortium of specialist companies who have come together to deliver a solution for Solvency II Solvency II Programme Slide Hillway Consulting
  • 4. Gain-Line & Solvency II Solvency II Programme Slide There are many stakeholders with differing priorities that need to be integral to the Solvency II Programme
    • Chief Actuary – centralised and consistent modelling approach for all actuarial ensuring realistic ‘what-if’ and scenario planning;
    CA CRO
    • Chief Risk Officer – enterprise wide consistent risk management standards and transparent risk modelling approach;
    • Chief Information Officer – robust IT governance with a consistent approach to data controls & quality;
    • Chief Financial Officer – faster reporting timetable with a consistent approach to financial and management information;
    • Chief Executive Officer – enhanced business performance through risk-based decision making and more efficient allocation of capital.
  • 5. Solvency II Components Programmes will be challenged to align a variety of different functions as Solvency II will impact all elements of the Business Slide Solvency II Programme (inc Programme Office) Internal Model/Risk Management ORSA and the 6 Tests Risk Management Data Quality & Governance Solvency II Data Repository IT Systems & Processes Systems & Data Governance & Oversight Documentation, Comms & Training Governance & Communications External Reporting Standard Formula Portfolio Management Calculation Kernel Assets & Asset Liability Management (ALM) Balance Sheet & Portfolio Management Technical Provisions
  • 6. Data Policy & Governance The Data Policy should define the complete needs of all data and all data users across the organisation Slide
  • 7. There are a number of areas of consideration for Data Policy & Governance Solvency II Programme Slide
    • Complete, Accurate & Appropriate;
    • Meaningful to the business and value adding;
    • Compatibility with shared systems, data warehouses, part of a bigger group?
    • Enterprise Wide vs. Focus on Internal Model ?
    • Risk management Overlay vs. Embedded ?
    • Producer / Consumer approach to overcome issues with data flows across various functional areas.
    Data Policy & Governance
  • 8. Systems & Data An approach to managing the various key areas is given below Solvency II Programme Slide
  • 9. Data Directory The Data Directory is the central foundation on which the data workstream is built. Slide
    • Is mandated by Lloyd’s;
    • Guidance has been produced based on CEIOPS’ guidance;
    • Each row represents a group of data which relates to an Internal Model Input;
    • Key input into the Internal Model.
  • 10. Data Dictionary A working tool which is used across the whole Solvency II Programme Slide
    • Much more detailed/granular with respect to the data;
    • Owned by the data architect;
    • Shows the lineage and characteristics of each individual data field;
    • A number of tools can be used to hold the Data Dictionary.
  • 11. Data Flows & Controls Diagrams The Data Flows & Controls Diagrams (DFDs) pictorially represent how the data is manipulated and physically moves within the organisation. Slide
    • Created for each row on the Data Directory – i.e. for each Internal Model Input;
    • Should cross-reference the Data Dictionary;
    • Overall data quality and governance can be seen by incorporating the data controls.
  • 12. Data Controls Register The Data Controls Register (DCR) is the central repository that contains all of the data control across the organisation. Slide
    • The DCR categorises the controls into a number of sub-categories so that weaknesses and deficiencies can be identified.
  • 13. Reports Register The Reports Register (RR) highlights all of the reports and reconciliations that occur to the data as it moves through the organisation. Slide
    • The RR categorises all of the reports (both manual and automated) that are used within the organisation to see the effectiveness of the controls.
  • 14. Solvency II Programme Slide
    • Solvency II, uniquely, effects all areas of an organisation;
    • Programmes need to be structured in such a way to address this;
    • ‘ C-Level’ Executives are accountable for Solvency II;
    • Different organisations will have different requirements dependent upon the systems/legacy landscape;
    • Data is central to the concept of Solvency II;
    In Summary…
    • Minimum standards and requirements must be delivered.
    • Kesh Sharma – Director of Magellan Consultancy Services
    • Part of the
    • [email_address]