PRA published a policy statement (PS15/18) providing feedback to responses to CP14/17 on extension of the Senior Managers and Certification Regime (SM&CR) to insurers and to CP28/17 on implementing the extension of the SM&CR to insurers (along with certain other amendments). Additionally, PRA updated the supervisory statements SS39/15, SS5/16, SS28/15, SS10/16, and SS3/17 to reflect changes in terminology as a result of the publication of PS15/18. The extension of the SM&CR will apply with effect from December 10, 2018.
CP14/17 was issued on July 26, 2017 and its comment period ended on November 03, 2017 while CP28/17 was issued on December 13, 2017 and its comment period ended on February 21, 2018. PRA received 14 responses to the proposals in CP14/17 and eight responses to the proposals in CP28/17. The responses received were broadly supportive of the policy intent and PRA made some minor changes to the policy proposals as a result of the feedback. Chapters 2 and 3 of PS15/18 summarize feedback on the PRA proposals in CP14/17 and CP28/17 and on the final policy of PRA. PS15/18 is relevant to all Solvency II insurance firms (UK Solvency II firms, the Society of Lloyd’s and managing agents, and third-country (re)insurance branches) and to insurance special purpose vehicles, large non-Directive firms, and small non-Directive firms. PS15/18 contains the following:
- The final rules for the extension of SM&CR to insurers by amending the Senior Insurance Managers Regime or SIMR (Appendix 1)
- An updated SS35/15 on strengthening individual accountability in insurance (Appendix 2) and terminology updates to other existing supervisory statements
- A consolidated Statement of Policy on conditions, time limits, and variations of approval (Appendix 3)
- The streamlined set of forms for SM&CR and amendments to Part 4A permissions forms (Appendix 4)
SS39/15 sets out the RA expectations for firms in relation to the whistleblowing procedures, training, and whistleblowers’ champion. SS5/16 is related to corporate governance. SS28/15 sets out the PRA approach to strengthening individual accountability in banking. SS10/16 is related to remuneration requirements under Solvency II and SS3/17 sets out the PRA expectations from firms investing in illiquid, unrated assets within their Solvency II matching adjustment portfolios.
Effective Date: December 10, 2018
Keywords: Europe, UK, Insurance, Banking, Solvency II, SM&CR, SIMR, Accountability, PS15/18, CP14/17, CP28/17, PRA
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