Dublin, 16 November 2016

  • InvestPro™ from Financial Risk Solutions (FRS) is being used by a branch of a tier-one life insurer to improve its Solvency II capital position using underfunding on its unit-linked business.


Financial Risk Solutions (FRS), a Dublin-based provider of unit-linked investment administration and compliance oversight software, is pleased to announce that its InvestPro™ software is now being used by a tier-one life insurer implementing part of its capital management programme under Solvency II through the use of underfunding for its unit-linked business.

Solvency II Opportunities for Capital Management:
The introduction of Solvency II allowed life companies to change how they operated their unit-linked matching processes. They are no longer required under Solvency II regulations to hold assets to match to the full face value of unit-linked liabilities.

Unit underfunding reduces the market volatility of Solvency II basis own funds, reduces market risk in solvency capital requirements and releases cash from the unit-linked funds. But it introduces other risks including additional operational risks which must be subject to appropriate governance and must be controlled using robust unit matching systems like InvestPro™.

To maximise capital efficiencies a new unit matching approach is required. The new unit-matching process is more complex than the existing business process and must cater for short positions in assets and units and manage the accounting associated with such short positions. InvestPro™ is specifically designed to meet this challenge.

The client went live in Autumn 2016.

FRS Chief Marketing Officer, Frank Carr commented:
‘One of the beneficial aspects of Solvency II was the ability for insurers to hold capital appropriate to the risks in the business. Financial Risk Solutions is delighted to be enabling insurers using its technology to implement and manage capital efficiency programmes in the unit underfunding area. This is now a high priory for many unit-linked life companies.’

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Notes to Editor:

About Financial Risk Solutions (FRS) Founded in 1999 by actuaries and IT specialists, Financial Risk Solutions Ltd (FRS) is a leading provider of unit pricing, investment administration, asset reporting and compliance oversight software specifically designed for the Life Assurance and Asset Management industries. FRS offer a proven range of modular, intuitive technology solutions which allow customers to pro-actively monitor and administer investments as well as mitigate risk by continually monitoring breaches and exceptions to critical investment processes. These solutions include:

InvestPro™ securely automates multiple complex fund administration processes within a single application. InvestPro™ unit-pricing and investment administration software is scalable, modular and flexible.

InvestGRC™ empowers insurers and asset managers to meet Pillar III asset reporting standards in the Solvency II world via a single, analytics-driven database, combining data from internal and external sources.

InvestOPS™ automates the validation of operational activity performed by outsourcing partners, enabling firms to supervise outsourced functions, data and to manage the associated risks. For more information visit www.frsltd.com or follow FRS on LinkedIn.

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