European Insurance: Solvency II (14 March 2017)

OAC Digest
EU / European Parliament / EIOPA, Life insurance, Non-Life, PRA / Bank of England, Solvency II

14 March 2017

Selected recent Solvency II news items:

On 8 March, EIOPA's Insurance and Reinsurance Stakeholder Group (IRSG) published their "Opinion on Potential Harmonisation of Recovery and Resolution Frameworks for Insurers." Their key points included:

  • The SCR should remain across Europe as the only intervention point.
  • It seems reasonable to have more experience on the operation of [Solvency II] before proposing new requirements.
  • The scope of any requirements to have a recovery plan before breach of the SCR should be limited through proportionality to firms for which it would provide tangible benefits and should in such cases, be seen as part of their regular ORSA rather than an additional process.

On 3 March, EIOPA published on their website a request for insurance and reinsurance undertakings to provide information for the EIOPA’s 2017 Long-Term Guarantees Report. The request includes information on the impact of the symmetric adjustment mechanism for equity risk on the financial position of undertakings but only where the equity risk capital requirement is above 50% of the solvency capital requirement (SCR). Insurance and reinsurance undertakings must submit results to National Supervisory Authorities by 15 June 2017. The PRA advised that firms should expect to hear from the PRA in due course and they will contact firms as deemed appropriate.    

On 2 March, the Bank of England announced that it is making a User Acceptance Testing (UAT) environment, incorporating Taxonomy 2.1.0, available for firms from Tuesday 18 to Friday 28 April 2017 to test their Solvency II submissions in advance of making a legal submission to the BEEDS portal.

On 28 February, EIOPA published a new and first Risk Dashboard based on Solvency II data showing a high level of macro and market risks. The regulator states "The results for the third-quarter 2016 show that the low-yield environment and market risks continue to be a major challenge for the European insurance sector."

See also European Insurance: General (13 March 2017) for draft responses to EIOPA's discussion paper on the review of the Solvency Capital Requirement (SCR) standard formula. 


David Gray

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David Gray
Consultant Actuary

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