What financial requirement can be identified by an insurer undertaking an own risk and solvency assessment?

The financial requirement identified by an insurer undertaking an own risk and solvency assessment is the amount of capital. This assessment process is crucial for insurers as it evaluates their risk management policies and the sufficiency of their capital in light of those risks.

During the own risk and solvency assessment (ORSA), insurers must analyze their ability to meet regulatory capital requirements while also ensuring that they have enough capital to cover their unique risks, potentially under extreme scenarios. This involves understanding not only the current financial position but also how future risks and uncertainties could impact their capital requirements.

The capital amount quantified in the assessment reflects what is necessary for the insurer to maintain solvency and continue operations effectively, thus supporting the overall resilience of the insurer in varying market conditions. Other financial metrics like overall profit margin, loss ratio, and operational expenses are significant for assessing performance and efficiency, but the core focus of an ORSA is establishing a clear understanding of the capital needed to remain solvent amidst risk exposures.