Strategic decisions in solvency ii for the insurance industry of European Union

This paper aims to present how undergoing significant legislative changes in the insurance market of European Union, called Solvency II regime, can benefit to development of insurance industry, risk management, protection of policyholders and the stability of the financial system as a whole.The main purpose of this paper is to present the key advantages of Solvency II changes under the existing regulatory system, to analyse the structure of Solvency II three-pillar system. An effective implementation of Solvency II Directive will enhance insurers to develop more progressive risk management and will give for policyholders greater confidence in the products of insurers.