Važeći propisi osiguravajućih društava u Evropskoj uniji i analiza solventnosti u Bosni i Hercegovini sa aspekta garantnog fonda
Applicable regulations of insurance companies in the European Union and the analysis of solvency in Bosnia and Herzegovina in terms of the guarantee

Summary/Abstract: The subject of this paper is an effect analysis of the solvency regime in effect in the domestic insurance sector on an establishment of a guarantee fund and the value assessment of an insurance company. Measurements and analysis of the insurance sector in the EU and Bosnia and Herzegovina have shown that in calculating the guarantee fund in accordance with the current regime, the so-called solvency takes into account only the risks insured, while other relevant risks are not included (market risks, interest rate risk, operational risk and non-payment risk). Likewise, extremely high capital is evident among some insurance companies in relation to the prescribed minimum, out of which the surplus is not insufficiently employed, as it is not in the function of increasing the profit and the market value of the insurer in accordance with the market opportunities, which are the key objectives of the owners of capital. On the other hand, some insurers who lack the guarantee fund with respect to the prescribed minimum are faced with evident problems in conducting business, illiquidity and insolvency being the key issues, along with significant decrease of the net book value. Due to inadequate valuating of insurance contracts, inadequate administering of the assets and liabilities of companies, booking underestimation, overestimation of assets, uncertain and illiquid investments, insurance insolvency, insufficient reinsurance coverage, inadequate risk diversification, unsuitable corporate governance and internal controls along with related business problems, dozens of insurance companies lacking guarantee fund have been terminated in the EU and in Bosnia and Herzegovina. With the aim of overcoming the problems set forth, new regulation under the so-called Solvency II project in the EU prescribes qualitative and quantitative change of the insurer solvency conditions and sets new market rules, which will among other things provide better correlation between the capital structure and the risk profile, resulting in a decrease of the limit of capital required by insurance companies in order to maintain solvency.

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