News Story
Albania Successfully Completes First Quantitative Impact Study under Solvency II
Albania has completed its first Quantitative Impact Study (QIS) to prepare for the introduction of the Solvency II regulatory framework, marking an important milestone in modernizing the country’s insurance sector and gradually aligning it with European Union standards.
Conducted under the Albania Financial Resilience and Development Project, supported by the Swiss State Secretariat for Economic Affairs (SECO) through the Finance for Development (F4D) Program, the exercise gives Albania’s Financial Supervisory Authority (AFSA) and the insurance market their first structured view of how insurers would perform under a risk-based solvency regime.
The QIS was the result of months of preparation and close collaboration among AFSA, the World Bank, Prime Re Solutions of Switzerland, and all insurance companies operating in Albania. Following preparatory training in June 2025, the study was launched in September 2025 and ran through March 2026. Over that period, insurers submitted data, participated in iterative feedback rounds, and engaged in detailed technical discussions designed to strengthen both the quality of the exercise and the market’s understanding of Solvency II requirements
Beyond completing an important technical exercise, the QIS generated valuable insights for both supervisors and market participants. It showed that most insurance companies already meet Solvency II Pillar 1 capital requirements or could do so with limited adjustments. A few companies would require more substantial, but still achievable, changes over the medium term, particularly in investment strategy, reinsurance programs, and risk profiles. The exercise also highlighted broader strengths in non-life insurance data and reinsurance practices, while pointing to areas that need further work, including investment concentration, asset valuation, life reserving, and catastrophe risk modeling.
For AFSA, the study establishes a credible analytical baseline for risk-based supervision and for the phased adoption of Solvency II concepts. For insurers, it offers a clearer roadmap for strengthening capital management, risk governance, and data quality ahead of future implementation. In this sense, the QIS was a practical test of the sector’s readiness and a way to identify where further capacity building and regulatory refinement will matter most.
The study concluded in March 2026, with the comprehensive report and results discussed with AFSA and each insurance company, followed by a two-day workshop on internal models and QIS case studies, all held from 25–27 March 2026. These sessions addressed identified weaknesses and offered practical recommendations to further strengthen the sector.
The broader support program is continuing, with work on internal models already underway and a final phase on Own Risk and Solvency Assessment still ahead.