What is Solvency Ratio?
Solvency Ratio A regulatory metric that compares an insurer's capital to its required solvency capital, used to assess financial strength and regulatory compliance.
Source: CFA Institute, IFRS Foundation, FASB (GAAP), Basel III Framework
How is “Solvency Ratio” Used in Practice?
A strong solvency ratio demonstrates the insurer’s ability to meet obligations even under adverse economic conditions.
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Who Needs to Know This Term?
- Financial Analysts
- Bankers
- Traders
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What is Solvency Ratio?
A regulatory metric that compares an insurer's capital to its required solvency capital, used to assess financial strength and regulatory compliance.
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