Some 43% of European insurers are unlikely to be prepared for Solvency II by 2014, research by Ernst & Young has revealed.
The E&Y report said that 90% of insurers will be ready for Solvency II by 2015.
Insurers from the UK and the Netherlands are the best prepared for the regulation, while German and Italian firms are the least prepared.
Solvency II is currently scheduled to be implemented by 2014, but speculation is mounting that the deadline may be pushed back further.
Meanwhile, E&Y said that 69% of insurers will be hard pushed to meet the data management requirements under Solvency II.
Jan Leiding, partner in financial services at E&Y, said: "Making the data landscape work requires firms to integrate multiple complex IT systems and is a massive challenge.
"The survey shows that progress in implementing appropriate ownership, governance and controls is particularly slow.
"The shifting Eiopa deadlines have offered excuses, but these will be viewed as fundamental failings and now require prompt attention."
