Solvency II – To Stick or Twist?



  • One observation: as a result of companies having overspent their budgets on Solvency II and in a knee jerk reaction to save money, currently there appears to be a ‘panicky’ push to move SII work away from experienced contractors and into BAU, in order to benefit from the corresponding lower cost base of permanent staff.

    This might work if a) the existing BAU staff have made the required step change to become ‘risk’ rather than ‘compliance’ focussed and b) the contractors electing to move into the permanent space, meet the grade.

    As the second tier of companies start down the SII path (which if done well can be highly lucrative), the good contractors will have plenty of work. They will bring years of experience to companies starting the SII journey afresh and compliance will be reached relatively quickly with all the resultant financial benefits of a more sophisticated model.

    Contractors/interims/consultants in my sphere are not electing to move to a permanent basis. Current experience is showing that companies letting experienced contractors go too early are experiencing poor performance and capital add-ons look likely to increase.(There is evidence in the market already). The required BAU step change is taking time and Arrow visits will uncover and financially penalise any weaknesses that exist (and there is evidence of this already). So, the steps a) and b) above may prove very costly for companies if taken prematurely.

    • This raises an interesting point iro capital add-ons.  Are these as a direct result of loss of exoerienced staff (contract or otherwise) or are they as a result of poor understanding in the first place?  Without naming and shaming, are you able to expand on the add ons?

  • Personally, I have been unindated with calls relating to Pillar 3 work, also work on govenance and the ORSA.

    Rates however have not been as high as what I would have expected, they range form £600 per day to £800.

    What I have been telling agents is that most people already engaged in similar roles are on £800 to £1,200 per day, why would they leave their current roles and look at new roles if the day rates are not attractive. To get someone to look around, the rates will have to be more attractive.

    I personally would not look at roles currently, to move from my current position, unless the roles are paying 4 figure day rates!

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