EC published the Implementing Regulation (EU) 2019/228 that lays down technical information for calculation of technical provisions and basic own funds for reporting with reference dates from December 31, 2018 until March 30, 2019, in accordance with the Solvency II Directive (2009/138/EC). This Regulation shall enter into force on the day following that of its publication in the Official Journal of the European Union. It shall apply from December 31, 2018.
Insurance and reinsurance undertakings shall use the technical information provided in the Annexes to this regulation when calculating technical provisions and basic own funds for reporting with reference dates from December 31, 2018 until March 30, 2019. For each relevant currency, the technical information used to calculate the best estimate in accordance with Article 77 of Solvency II Directive, the matching adjustment in accordance with Article 77c of that Directive and the volatility adjustment in accordance with Article 77d of that Directive shall be the following:
- The relevant risk-free rate term structures set out in Annex I
- The fundamental spreads for the calculation of the matching adjustment set out in Annex II
- For each relevant national insurance market, the volatility adjustments set out in Annex III
To ensure uniform conditions for the calculation of technical provisions and basic own funds by insurance and reinsurance undertakings for the purpose of Directive 2009/138/EC, technical information on relevant risk-free interest rate term structures, fundamental spreads for the calculation of the matching adjustment, and volatility adjustments should be laid down for every reference date. Insurance and re-insurance undertakings should use the technical information, which is based on market data related to the end of the last month preceding the first reporting reference date to which this Regulation applies. On January 09, 2019, EIOPA provided EC with the technical information related to end of December 2018 market data. Given the need for the immediate availability of the technical information, it is important that this Regulation enters into force as a matter of urgency. For prudential reasons it is necessary that insurance and reinsurance undertakings use the same technical information for calculating technical provisions and basic own funds irrespective of the date on which they report to their competent authorities. This Regulation should, therefore, apply from the first reporting reference date to which this Regulation applies.
Related Link: Regulation (EU) 2019/228
Effective Date: February 09, 2019
Keywords: Europe, EU, Insurance, Solvency II, Own Funds, Reporting, Matching Adjustment, Volatility Adjustment, Regulation 2019/228, EC
Previous ArticleFSB Publishes Responses to Consultation on CCP Resolution Issues
The Bank of England (BoE) published a consultation paper on approach to setting minimum requirement for own funds and eligible liabilities (MREL), an operational guide on executing bail-in, and a statement from the Deputy Governor Dave Ramsden.
The European Banking Authority (EBA) is seeking preliminary input on standardization of the proportionality assessment methodology for credit institutions and investment firms.
Certain regulatory authorities in the US are extending period for completion of the review of certain residential mortgage provisions and for publication of notice disclosing the determination of this review until December 20, 2021.
The Prudential Regulation Authority (PRA) published the policy statement PS18/21, which introduces an amendment in the definition of "higher paid material risk taker" in the Remuneration Part of the PRA Rulebook.
The European Banking Authority (EBA) published its annual report on asset encumbrance in banking sector.
The European Banking Authority (EBA) published a methodological guide to mystery shopping.
The Australian Prudential Regulation Authority (APRA) released a letter to authorized deposit-taking institutions to provide an update on key policy settings for the capital framework reforms, which will come into effect from January 01, 2023.
The Committee on Payments and Market Infrastructures (CPMI) and the International Organization of Securities Commissions (IOSCO) published a report that assesses the business continuity planning activities of financial market infrastructures or FMIs.
The Bank of England (BoE) published questions and answers (Q&A) on OSCA to BEEDS migration for statistical reporting as well a presentation from the project overview session held with statistical reporters.
The Basel Committee on Banking Supervision (BCBS) is consulting on a technical amendment to the Basel Framework to reflect a new process reviewing the global systemically important bank (G-SIB) assessment methodology.