FSA already recruiting for consultation paper responses

Insurers lagging behind on Solvency II will face difficulties in hiring staff, IBM has warned.

UK associate partner John Smith told last week’s Insurance Times roundtable discussion on the regulatory changes that recruitment agencies were already stepping in to fill the void left by a shortage of actuaries and risk managers.

Insurers falling behind in their preparations could end up paying more for staff with specialist skills, he said.

“If you don’t engage in this space now, when you need to do strategic heavy lifting, you are going to be in trouble. Your capacity for delivery is going to be constrained and your entire costs increased.”

Deloitte partner Lis Gibson said: “There is huge competition for talent on the non-life side, although it will really kick off in the next six to 12 months.”

The FSA was already recruiting staff for responses to consultation papers, she said.

The European Commission has set a deadline of October 2012 for all companies to be ready for the regulation.

Lloyd’s is planning a dry run next year, however; something which could put further pressure on the existing small talent pool.

Lloyd’s was on the “front foot” with preparations followed by life insurers, said Gibson. General insurers were the slowest off the mark. “The risk is that all the non-life market resources will be sucked into Lloyd’s.”

Companies should act sooner rather than later, she said. “People need a certain length of time to get familiar with technical details.

“You cannot expect someone to go from beginner to expert quickly; it can take some time.”

Gibson said Aviva’s decision to create a European headquarters in Dublin was further evidence that Solvency II would trim the number of subsidiaries holding capital.

“There is such a big disadvantage in having capital spread around many different legal entities,” she said.