Risk Management

  • The first year of operation in line with the Solvency II regulations showed a strong capital adequacy and financial stability of Zavarovalnica Triglav and the Triglav Group. 
  • Both recorded high target performance values in the extreme environment of low interest rates and fierce competition at an acceptable level of risks.
  • Individual types of main risks are effectively managed through the established “three lines of defence” system. 
  • The stress tests and own risk assessment performed in the context of Solvency II showed strong resilience of the Company to external influences.

In 2016, the comprehensive and integrated risk management system was successfully upgraded at the level of the Triglav Group. In accordance with the new Solvency II regulations, the Company calculated and reported on capital adequacy in a timely manner. The Company conducted its own risk assessment, assessed the suitability of the standard formula and evaluated scenario tests. Furthermore, it participated in the stress test excercise, performed by the European Insurance and Occupational Pensions Authority (EIOPA) in 2016, in order to obtain the supervisory assessment of potential vulnerabilities of the sector to market risk." Intensive preparations for drawing up the Solvency and Financial Condition Report (SFCR) were undertaken, as the first such report will have to be submitted for 2016.

Major development activities concerning the risk management system at the Group level in 2016 included:

  • upgrading of the risk management system in all insurance subsidiaries of the Group, particularly with respect to currency risks and credit risks related to exposure to banks and banking groups; 
  • upgrading of the capital adequacy calculation and transfer of know-how to subsidiaries;
  • updating of the minimum risk management standards within the Triglav Group;
  • organisation of several workshops on risk management in subsidiaries for employees in Zavarovalnica Triglav and the Triglav Group.

Adequate capital and financial strength of the Group was confirmed by the two rating agencies S&P Global Ratings and A.M. Best, which upgraded the long-term credit rating and the financial strength credit rating of the parent company Zavarovalnica Triglav, the Triglav Group and the subsidiary Pozavarovalnica Triglav Re from “A–” to “A” in 2016. Both credit ratings have a stable medium-term outlook.

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