PRA Consults on Availability of Group Own Funds Under Solvency II

CP16/19 is relevant to all insurance firms within the scope of group supervision under the Solvency II Directive and to the Society of Lloyd’s. In July 2018, PRA had published CP15/18 on group own funds availability, which set out the proposed approach of PRA to the determination of the availability of group own funds and its expectations of firms in presenting relevant analysis to PRA. The consideration of responses to CP15/18, by PRA, were set out in the Policy Statement 9/19 and were included in an updated version of SS9/15. Further to these publications, the proposals in CP16/19 would clarify PRA expectations of firms seeking to demonstrate that the Solvency II assumption that subordinated liabilities and preference shares are not available to meet losses elsewhere in the group is inappropriate in a firm’s specific case. The proposals set out in CP16/19 have been designed in the context of the current UK and EU regulatory framework. PRA has assessed that the proposals will not be affected in the event that UK leaves EU with no implementation period in place.

Related Links

• Notification
• CP16/19 (PDF)
• SS9/15

Comment Due Date: October 21, 2019

Keywords: Europe, UK, Insurance, Solvency II, Group Own Funds, SS9/15, CP16/19, Group Supervision, SCR, Subordinated Liabilities, Preference Shares, PRA