Regulation in the insurance industry prompts tech investments

Regulatory changes in the insurance industry may prove to be a catalyst for investment in innovative technology systems, according to a new report by Clear Path Analysis.

The report Technology and Operations for Insurers examines how best to satisfy new regulatory frameworks whilst optimising business functions through the smarter application of intelligent data and innovative technology systems.

It said changes proposed under Solvency II and other European directives have been positive for the insurance industry overall but insurers must utilise technology to drive through efficiencies and deliver improved levels of income.

In a blog on the analyst’s website Andrew Melville, EMEA head of insurance product and strategy at Northern Trust, said Solvency II will require more reporting of insurers’ asset data from multiple sources leading to significant new challenges in managing information. 

“Regulatory reporting for an insurer with a multi-manager investment model is likely to be an arduous and complex process in which the ability to store all asset-related data in one place will be a significant advantage,” he said.

“While not directly aimed at insurers, this measure is likely to be particularly relevant for life insurers, where cash values are provided through annuities, endowments and other payments.”