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Solvency II report
Insurance consulting Insurance market insight Part VII and Section 13 transfers Risk management Solvency IILCP’s tenth annual analysis of Solvency II/UK reporting from 100 of the largest non-life insurers in the UK and Ireland.
Ten years of Solvency II: Navigating the future risk landscape
Ten years after the introduction of Solvency II, the non-life insurance market is both larger and better capitalised. Assets have grown from £152 billion to £227 billion, while the aggregate solvency coverage ratio has increased from 154% to 192%.
Despite recent softening market conditions, gross written premium has continued to increase year on year since the introduction of Solvency II, reaching £147bn in 2025. However, growth has been slower than in previous years.
Our latest Solvency II report considers how the risk landscape is evolving. Key risks discussed in the report include:
- Geopolitical risk: Remains a top concern for insurers. Reporting has shifted from general geopolitical concerns towards more specific conflicts, particularly those involving Israel, Iran and the US.
- AI risk: Around one-third of insurers in our sample consider AI risk. Where it is discussed, firms typically recognise both the risks and the opportunities arising from its use.
- Cyber risk: Insurers are demonstrating increasingly mature cyber security control environments through penetration testing, operational resilience scenario testing and cyber incident response plans.
- Emerging risks: Emerging risk frameworks are becoming more embedded within BAU risk management processes. Some firms are also beginning to recognise the interconnected nature of these exposures.
Explore our Solvency II report
Read nowTen years on from the introduction of Solvency II, the UK and Irish non-life insurance market is larger, more resilient and better capitalised. However, the risk environment is becoming increasingly complex and interconnected. Insurers will need to continue evolving their risk management, governance and capital strategies to respond effectively to the opportunities and challenges ahead.
Cat Drummond Partner and co-author of the report
Previous Solvency II reports
Access previous versions of our annual reviews of SFCR reporting.
2025: Managing risk in an era of transformation
Read the report2025: Managing risk in an era of transformation - Gibraltar supplement
Read the report2024: Balancing risk and opportunity in an uncertain world
Read the report2023: Navigating evolving and emerging risks
Read the report2022: Growing financial strength
Read the report2021: Change on the horizon
Read the reportYour questions answered
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Measured insurer by insurer, the average solvency coverage ratio across the 100 largest UK and Irish non-life insurers was 234% at their 2025 year-end, down from 237% in 2024.
On a market-wide aggregate basis, the solvency coverage ratio was 192%, down from 196% a year earlier. The ratio for UK insurers fell from 200% to 194%, while the Irish ratio fell from 181% to 179%. UK insurers typically attributed the reduction to capital-management activity, including M&A, premium growth, dividends and buybacks, rather than deterioration in claims experience or an increase in risk.
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Since Solvency II was introduced in January 2016, assets for the 100 largest UK and Irish non-life insurers have grown from £152.1bn to £226.6bn, while the aggregate solvency coverage ratio has risen from 154% to 192%, according to LCP’s tenth annual review of SFCR reporting.
Gross written premium reached £147bn in 2025, the ninth consecutive year of growth across the sample. The market is both larger and better capitalised than at the framework’s introduction, despite COVID-19, inflation, financial-market volatility and Brexit.
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Across the 2025 SFCRs of 100 UK and Irish non-life insurers, emerging risks were mentioned by 90% of firms, cyber risk by 83%, climate change by 82%, geopolitical risk by 75% and AI risk by 33%.
Geopolitical risk saw the sharpest increase, rising from 64% in 2024. Disclosures shifted from general geopolitical concerns towards specific developments, particularly the Israel-Iran conflict and tensions involving the US. A further 22% of insurers explicitly highlighted the interconnectedness of emerging risks, up from 14% in 2024.
