BaFin published an “interpretative decision” on the evaluation of amounts recoverable from reinsurance contracts and special purpose vehicles (SPVs) under Solvency II. The interpretative decision also addresses the handling of cash flows from settlement receivables and payables as well as deposit receivables and liabilities under Solvency II.
Under Solvency II, technical provisions are calculated without deducting the amounts recoverable from reinsurance contracts and SPVs (Section 77(4) of the Insurance Supervision Act (VAG)). The interpretative decision deals with the quantitative requirements in the Solvency II. The decision also deals with consideration of deposit liabilities in the Solvency Capital Requirement (SCR) standard formula.
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Keywords: Europe, Germany, Insurance, Reinsurance, Solvency II, Interpretative Decision, Reinsurance Contract, SCR, BaFin
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