March 18, 2019

EIOPA has requested the European Economic Area insurance undertakings, which are subject to Solvency II, to provide information on the long-term guarantee (LTG) measures. EIOPA requires this information for the preparation of the fourth LTG report, the opinion on LTG measures, and the review of Solvency II. The fourth LTG report of EIOPA is due in 2019 while the Solvency II review is due in 2020. EIOPA also updated the reporting template and technical specifications for the provision of this information.

Insurers are being requested to provide information on LTG measures, dynamic volatility adjustment, and long-term illiquid liabilities. The information to be provided on LTG measures includes impact of the extrapolation of risk-free interest rates on the financial position of undertakings, losses due to bond defaults and downgrades of bonds in matching adjustment portfolios, assets in matching adjustment portfolios, diversification effects in the calculation of the Solvency Capital Requirement when the matching adjustment is used, and overcompensation of the volatility adjustment.

National supervisory authorities will contact a representative sample of undertakings regarding the provision of information for each information request. Insurance undertakings should submit the completed reporting templates to the respective national supervisory authority. The templates should be filled according to the instructions in the technical specifications and taking into account the technical information. Insurance and reinsurance undertakings are requested to submit results to national supervisory authorities by May 17, 2019, whereas the deadline for insurance groups (for the dynamic volatility adjustment) is June 14, 2019. Deadline for national supervisory authorities to report to EIOPA (except group data) is May 29, 2019 while the deadline to report to EIOPA on groups is June 28, 2019.

The Solvency II Directive requires a review of the LTG measures and the measures on equity risk by January 01, 2021. The review will consist of the following phases:

  • EIOPA will provide annual reports on the impact of the application of the LTG measures and the measures on equity risk to the European Parliament, the Council of the EU, and the EC. 
  • EIOPA will submit an Opinion on the assessment of the application of the LTG measures and the measures on equity risk to EC in 2020.
  • Based on EIOPA's Opinion, EC will submit a report on the impact of the LTG measures and the measures on equity risk to the European Parliament and to the Council of the EU.

 

Related Links

Keywords: Europe, EU, Insurance, Solvency II, LTG Measures, SCR, Volatility Adjustment, EIOPA

Related Articles
News

FSB to Evaluate Effects of Too-Big-To-Fail Reforms for Systemic Banks

FSB is seeking feedback as part of its evaluation of the effects of the too-big-to-fail reforms for banks.

May 23, 2019 WebPage Regulatory News
News

APRA Releases Minor Changes to Reporting Standards on SA-CCR for Banks

APRA released minor changes to the three reporting standards for the standardized approach for measuring counterparty credit risk exposures (SA-CCR).

May 22, 2019 WebPage Regulatory News
News

APRA on Industry Self-Assessments into Governance and Accountability

APRA released an information paper analyzing the self-assessments performed by 36 of the country’s largest banks, insurers, and superannuation licensees in response to the final report on the Prudential Inquiry into the Commonwealth Bank of Australia (CBA).

May 22, 2019 WebPage Regulatory News
News

PRA Consults on Maintenance of TMTP Under Solvency II

PRA published a consultation paper (CP11/19) that sets out its approach to update supervisory statement (SS6/16) on maintenance of the transitional measure on technical provisions (TMTP) under Solvency II.

May 22, 2019 WebPage Regulatory News
News

APRA Proposes to Amend Guidance on Residential Mortgage Lending

APRA is consulting on revisions to the prudential practice guide APG 223 on residential mortgage lending in Australia.

May 21, 2019 WebPage Regulatory News
News

IASB Proposes Improvements to IFRS 9 and IFRS 16

IASB published the exposure draft ED 2019/2 that proposes amendments to four IFRS standards, including IFRS 9 on Financial Instruments and IFRS 16 on Leases.

May 21, 2019 WebPage Regulatory News
News

Denis Beau of BDF on Supervisory Priorities for Climate-Change Risks

Denis Beau, the First Deputy Governor of BDF, delivered opening remarks at the BCBS-BSCEE-FSI High-level Meeting for Europe on banking supervision.

May 21, 2019 WebPage Regulatory News
News

ISDA CDM to be Deployed for UK Digital Regulatory Reporting Pilot

ISDA announced deployment of the ISDA Common Domain Model (ISDA CDM 2.0) to support the UK FCA, BoE, and participating financial institutions in testing phase two of the Digital Regulatory Reporting pilot for derivatives.

May 21, 2019 WebPage Regulatory News
News

MAS to Consolidate Regulation of Merchant Banks Under Banking Act

MAS published a consultation paper that proposes to consolidate the regulation of merchant banks under the Banking Act and to move merchant banks to a licensing regime under the MAS Act.

May 21, 2019 WebPage Regulatory News
News

ESAs Amend Technical Standards on Mapping of ECAIs Under CRR

ESAs published a second amendment to the implementing technical standards on the mapping of credit assessments of External Credit Assessment Institutions (ECAIs) for credit risk under the Capital Requirements Regulation (CRR).

May 20, 2019 WebPage Regulatory News
RESULTS 1 - 10 OF 3118