What is Solvency II primarily concerned with?

Solvency II is a comprehensive regulatory framework specifically designed to oversee the insurance industry within the European Union. Its primary focus is on ensuring that insurance companies maintain adequate capital reserves to meet their long-term obligations to policyholders and beneficiaries. By establishing capital requirements that are reflective of the actual risks an insurer faces, Solvency II aims to enhance the resilience of these companies, promote financial stability, and protect policyholders.

The framework shifts from a rules-based system to a risk-based approach, which means that the capital requirements are tailored to the specific risk profile of each insurer. This ensures that companies are better prepared to absorb potential losses, thereby reducing the likelihood of insolvency and protecting consumers.

The other options relate to different aspects of financial regulation or governance that do not pertain to insurance capital requirements specifically, making them irrelevant within the context of Solvency II's objectives.