THE RISK MANAGEMENT IN THE SOLVENCY II APPROACH
Abstract
The price competition and the increased danger of catastrophic events, just like numerous economic changes and changes in law made it necessary to find a flexible business plan which can adapt to the organizational structure of an insurance company and a particular way the insurance business works. Bearing in mind the aforementioned changes, the Solvency II Framework Directive in the process of Own Risk аnd Solvency Assessment- ORSA includes the insurer’s long-term business plan projections based on the different financial and business scenarios, including the assessment of the capital necessary for the solvency of each and every one of these scenarios. The aim of this paper is to show the basic principles of the process of Own Risk аnd Solvency Assessment- ORSA and the challenges the insurance companies have to face when implementing these principles.
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