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Morningstar to Supply Holdings Data to Global Actuarial to Enable Solvency II Solution

Morningstar UK, a subsidiary of Chicago-based Morningstar, Inc., (NASDAQ: MORN), a leading provider of independent investment research, and Global Actuarial Limited, a niche consultancy focusing on risk management and actuarial services, have announced a data agreement that will assist life insurance companies with Solvency II reporting.

Under the agreement, Morningstar UK will supply Global Actuarial Limited with investment holdings data that will be integrated in a web-based tool developed by Global Actuarial. The solution will bring a complementary offering to insurance organisations across Europe, as they prepare for the introduction of Solvency II, an updated set of regulations requiring insurance companies operating in the European Union to meet enhanced solvency capital requirements.

Morningstar provides one of the largest and most comprehensive fund databases available to life insurance companies, with data on approximately 330,000 investment offerings. Using Morningstar data, the Global Actuarial tool will support life companies by enabling an immediate view of capital risk with portfolio holdings data for investments in European funds and other vehicles. The tool will also provide access to granular data at an increased reporting frequency in a specific format, as well as an efficient and flexible way to determine the stress factors for market risk through a completely auditable process.

Geoff Balzano, chief executive officer of Morningstar UK comments: “Our goal is to ease the calculation burden of Solvency II, simply by drawing on what we have been doing successfully for more than 25 years. To meet the requirements of Solvency II, life insurance companies will need timely accurate holdings data from an experienced and reliable source. We have decades of experience in this area, enabling us to support the life industry in their Solvency II preparations.”

Andries Beukes, director of Global Actuarial Limited comments: “Our clients should not have to make crude assumptions or use estimations because they can have a significant impact on their capital requirement. We have analysed the collective investments of a number of clients and can provide a transparent lens for most of our clients’ collective investments. This means they can examine their collective investments by using actual data, which may reduce capital requirements and enhance the ability to manage risks effectively.”

The Solvency II capital requirements must be calculated quarterly and monitored on an ongoing basis. The new regulations are scheduled for introduction on 1st January 2014.