and therefore lead to some major recapitalizations

The new Solvency II standards may cost much, much more expensive capital insurers... and therefore lead to some major recapitalizations. After numerous warnings to this effect from the European insurers or their federations ("Les Echos" from September 14), it is the turn of & Standard Poor's (S & P) to the terms of the equation. Remember that future prudential standards of the insurers directive was adopted in April 2009 for an adoption end of 2012, and that enforcement measures are being developed in pain. In a recent note, the rating agency calculates that the needs in own funds of the insurers, on the basis of the calibration proposals provided on 10 November by the European Committee of regulators of insurance (Ceiops), would increase 70-75 for life insurers, 65 for insurers non - tested in the fourth quantitative study of impact (QIS4) of 2007 levels.

Standard & Poor's acknowledges that this estimate could be slightly reduced in view of the light flexibilities granted recently by Ceiops, without however changing the gives. This will result in any way "a wave substantial capital increases and mass", says S & P, and probably also "a fundamental review of the economic models" in force in Europe in the insurance sector.

"Nothing has really changed.

In 2008, on the basis of the results of the QIS4, developed using the solid balance from 2007, Ceiops had estimated that 11 of European insurers would not be able to cover the requirement of capital target (SCR). S & P said that a study conducted at the end of the QIS4 on 15 of the members of the CRO Forum, the club which brings together major European insurers risk managers, had concluded was an average solvency ratio of 207. "Even if the changes made by the Ceiops did pass the impact of 70 to 60, the SCR increase resulting lead to a ratio of only 129 coverage, a level of comfort not enough for most insurers", observed the Agency.

In its third wave of opinion, communicated on January 29, the Ceiops indicates taking into account some of the comments of industry on important points, as the capital requirements for market risk and relaxed, in some cases, its positions. "In fact, nothing has really budged", is a professional. The Ceiops always proposes to 45 the charge quoted shares capital, but has agreed to move from 60 to 55 for non-listed shares. While it advocated to establish a correlation coefficient of 0.5 between the action and risk of interest rate - the crisis being passed by here-, it now offers the modulating between 0 and 0.5 as the exposure to interest rates is upward or downward. Many other matters also remain pending, such as the processing of entries or the risk of non-life underwriting.

The next step is the publication, late March or early April, technical specifications - in other words, the parameters testing - in the fifth quantitative impact study (QIS5), which will take place between August and November. "Now that we have the final point of the Ceiops, we know where we share to negotiate this month with the European Commission, because it is she who gives the orders and the determination point by point, recalls an insurer. One thing is certain: If, at the exit of the QIS5, half of the insurers do not cover their SCR, it will be a disaster for everyone.