Solvency II white paper addresses importance of operating efficiency

In the run up to the January 2013 Solvency II deadline, insurers have spent most of their time and effort on implementing systems and procedures for measuring and calculating levels of capital and prime risk. But without adequate processes and controls in place in business operations, the capital adequacy levels required could be adversely impacted by operational risk weightings with a consequent impact on competitiveness.

Tony Armour, managing director for business process solutions at DST Global Solutions, said: "Solvency II is about change of behaviour, managing your business netter and proving that you are doing so. At DST Global Solutions we believe that business process management will be a key enabler for Solvency II compliance."

The white paper describes how business process management within insurance operations has long been focused on the end customer as organisations seek to improve customer service while trying to meet internal productivity, quality and cost targets. With risk management at the centre of the Solvency II regime, organisations will need to look beyond the use of traditional tools such as spreadsheets and ad hoc reports, and instead begin to utilise more sophisticated solutions that can orchestrate access to these sources of information.

Mr Armour continued: "Deploying a solution that enables the end-to-end automation, distribution and recording of processes not only enforces their use and facilities adoption, but allows production of audit trails and digital documentation. Solvency II should be seen as a competitive imperative, and those who are able to demonstrate sound operational control and efficiency will benefit from reduced operational risk as well as capital adequacy requirements."

The DST Global Solutions white paper is available to download from the company's wesite.