Catlin Group chief executive officer Stephen Catlin doubts whether the new European insurance rules known as Solvency II will be ready to be applied consistently in different countries by the time they are supposed to take effect.

Mr Catlin, who heads the Bermuda-based re/insurer said the implications of Solvency II, due to take effect at the start of 2013, would go far beyond the European Union.

He was also concerned about whether there were enough skilled staff, among companies and regulators, to fully prepare for the changes the new rules will bring.

“Every company has to throw a considerable amount of resource at the challenge,” said Mr Catlin, speaking at the inaugural Bermuda Monetary Authority International Regulatory Forum on Monday.

“We have a team of 25 people doing that, headed by a person who used to be our chief actuary.

“We are concerned about the general lack of resources around the globe to meet these issues. There are not enough good people around who really understand the issues.

“I think it's far more complex than most people realise.”

Solvency II will raise risk-based capital requirements, seek to improve levels of corporate governance and transparency.

The BMA, the Island's insurance regulator, is enhancing its regulations to try to match Solvency II standards and achieve equivalence. Failure to achieve equivalence would mean Bermuda-based companies being competitively disadvantaged in the EU market.

Mr Catlin's fellow panellist Alberto Corinti, deputy director of the CEA (European Insurance and Reinsurance Federation), said he was concerned about how the new rules would be applied by regulators in different countries.

“It's a system that requires the use of discretion by supervisors,” Mr Corinti said. “Companies are concerned about how this discretion will be used and that it is used in an appropriate way.”

Mr Catlin said there was a long way to go on issues surrounding the implementation of Solvency II.

“There is a lot more work to be done,” he said. “This goes way outside of Europe. Do I think we are going to reach consistency by the end of 2012? No, I don't.

“Do I think we can make significant progress by then? Yes, I do. But we have a long way to go.”

He suggested that the debate over the different elements of Solvency II could well focus around the same issues in five or ten years' time as it did now, because there was “not always a right answer”.

Gabriel Bernadino, chairman of the European Insurance and Occupational Pensions Supervi

sors (CEIOPS), admitted that there would be a learning curve.

“This is something we will learn by doing,” he said. “Consistency is the key. This is a major challenge and it will take time to be consistent and to have common implementations.”

Shanna Lespere, director, insurance supervision, complex institutions, for the BMA, said that coordination and communication between the regulators of different countries, particularly in the form of “supervisory colleges”, would be key to achieving consistent regulation.

“The ultimate goal is the convergence of international standards,” Ms Lespere said.