Column: Roger's Soapbox

Dreams of Solvency

By: | February 22, 2016 • 2 min read
Roger Crombie is a United Kingdom-based columnist for Risk & Insurance®. He can be reached at [email protected]

Knock me down with a feather. Solvency II, as widely discussed and rarely seen as Bigfoot, finally became law on Jan.1.


Solvency II, nicknamed S2, is the nom de guerre of European Union Directive 2009/138/EC, a set of pan-European insurance solvency and governance regulations. The directive is the work of the European Insurance and Occupational Pensions Authority (EIOPA), which would be the worst name for a blues band ever.

S2 has more of a ring. It’s one of those European laws where each country enforces its own citizens’ behavior until something goes wrong. Then everyone shrugs their shoulders and walks away with their heads held high and occupational pensions intact.

That’s how it seems to work with most big European laws, such as state solvency, immigration, borders: sweet dreams and flying machines, in pieces on the ground.

The history of S2 is one of false starts, unworkable ideas and opt-outs that may already, via the inexorable passage of time, have produced an increase in the solvency standards of the major insurance and reinsurance companies operating in the European theatre.

The directive is the work of the European Insurance and Occupational Pensions Authority (EIOPA), which would be the worst name for a blues band ever.

The key to S2’s history is in the directive’s number: 2009. It was then that European regulators first presented the idea of uniform insurance regulation across Europe, despite the fact that uniform anything in Europe has proved elusive. (Like many, I am perforce a European, but would rather not be.)

S2 was a consequence of the Great Recession of 2007-08. In short, having decided not to punish the bankers or almost any of the others who caused the whole mess, Europe vowed to make those who sell insurance within its borders uphold a new series of solvency, risk management and accounting standards.

The insurers hadn’t done anything wrong. They’re built to last.

Quite a few of them are not too big to fail, but too well-managed to fail.

S2 was set to be introduced, I forget exactly when, so let’s be charitable and say 2012, then 2013, then 2014, and now it’s finally happened.

S2 is one of those processes which doesn’t put an end to anything, or even really a start. Insurance companies already knew they needed serious capital reserves and robust administrative systems. That knowledge is something you pick up after a few years on the job.


Looking ahead, two main questions arise.

First, what terrible omission will bring the whole thing into disrepute? It might be in the captive world, which was carved out of S2 as if it wasn’t really insurance at all, which won’t be an easy argument to make to the IRS.

Second, will it work? Will the complex solvency ratios and operational rules and regulations actually stand the industry up when the next Great Recession blows into town?

Or will S2 prove inadequate to the task? We can only wait and see.

More from Risk & Insurance

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Risk Management

The Profession

Janet Sheiner, VP of risk management and real estate at AMN Healthcare Services Inc., sees innovation as an answer to fast-evolving and emerging risks.
By: | March 5, 2018 • 4 min read

R&I: What was your first job?

As a kid, bagging groceries. My first job out of school, part-time temp secretary.

R&I: How did you come to work in risk management?

Risk management picks you; you don’t necessarily pick it. I came into it from a regulatory compliance angle. There’s a natural evolution because a lot of your compliance activities also have the effect of managing your risk.

R&I: What is the risk management community doing right?


There’s much benefit to grounding strategic planning in an ERM framework. That’s a great innovation in the industry, to have more emphasis on ERM. I also think that risk management thought leaders are casting themselves more as enablers of business, not deterrents, a move in the right direction.

R&I: What could the risk management community be doing a better job of?

Justified or not, risk management functions are often viewed as the “Department of No.” We’ve worked hard to cultivate a reputation as the “Department of Maybe,” so partners across the organization see us as business enablers. That reputation has meant entertaining some pretty crazy ideas, but our willingness to try and find a way to “yes” tempered with good risk management has made all the difference.

Janet Sheiner, VP, Risk Management & Real Estate, AMN Healthcare Services Inc.

R&I: What was the best location and year for the RIMS conference and why?

San Diego, of course!  America’s Finest City has the infrastructure, Convention Center, hotels, airport and public transportation — plus you can’t beat our great weather! The restaurant scene is great, not to mention those beautiful coastal views.

R&I: What’s been the biggest change in the risk management and insurance industry since you’ve been in it?

The emergence of risk management as a distinct profession, with four-year degree programs and specific academic curriculum. Now I have people on my team who say their goal is to be a risk manager. I said before that risk management picks you, but we’re getting to a point where people pick it.

R&I: What emerging commercial risk most concerns you?


The commercial insurance market’s ability to innovate to meet customer demand. Businesses need to innovate to stay relevant, and the commercial market needs to innovate with us.  Carriers have to be willing to take on more risk and potentially take a loss to meet the unique and evolving risks companies are facing.

R&I: Of which insurance carrier do you have the highest opinion?

Beazley. They have been an outstanding partner to AMN. They are responsive, flexible and reasonable.  They have evolved with us. They have an appreciation for risk management practices we’ve organically woven into our business, and by extension, this makes them more comfortable with taking on new risks with us.

R&I: Are you optimistic or pessimistic about the U.S. health care industry and why?

I am very optimistic about the health care industry. We have an aging population with burgeoning health care needs, coupled with a decreasing supply of health care providers — that means we have to get smarter about how we manage health care. There’s a lot of opportunity for thought leaders to fill that gap.

R&I: Who is your mentor and why?

Professionally, AMN Healthcare General Counsel, Denise Jackson, has enabled me to do the best work I’ve ever done, and better than I thought I could do.  Personally, my husband Andrew, a second-grade teacher, who has a way of putting things into a human perspective.

R&I: What have you accomplished that you are proudest of?

In my early 20s, I set a goal for the “corner office.” I achieved that when I became vice president.  I received a ‘Values in Practice’ award for trust at AMN. The nomination came from team members I work with every day, and I was incredibly humbled and honored.

R&I: What is your favorite book or movie?

The noir genre, so anything by Raymond Chandler in books. For movies,  “Double Indemnity,” the 1944 Billy Wilder classic, with insurance at the heart of it!

R&I: What is your favorite drink?


Clean water. Check out for how to help people enjoy clean, safe water.

R&I: What’s the best restaurant at which you’ve eaten?

Liqun Roast Duck Restaurant in Beijing.

R&I: What is the most unusual/interesting place you have ever visited?

China. See favorite restaurant above. This restaurant had been open for 100 years in that location. It didn’t exactly have an “A” rating, and it was probably not a place most risk managers would go to.

R&I: What is the riskiest activity you ever engaged in?

Eating that duck at Liqun!

R&I: If the world has a modern hero, who is it and why?

Dr. Seuss who, in response to a 1954 report in Life magazine, worked to reduce illiteracy among school children by making children’s books more interesting. His work continues to educate and entertain children worldwide.

R&I: What do your friends and family think you do?

They’re not really sure!

Katie Dwyer is an associate editor at Risk & Insurance®. She can be reached at [email protected]