Featured Product

    OSFI Revises the 2019 Minimum Capital Test Guideline for P&C Insurers

    November 30, 2018

    OSFI released a revised Minimum Capital Test (MCT) Guideline for federally regulated property and casualty (P&C) insurers. The MCT 2019 guideline incorporates changes to reflect review of the framework for reinsurance, International Financial Reporting Standard (IFRS) 16, and the amendments to the Guideline B-5 on asset securitization. Effective date for the revised MCT guideline is January 01, 2019.

    This guideline outlines the capital framework, using a risk-based formula, for target and minimum capital/margin required and defines the capital/assets that are available to meet the minimum standard. The MCT determines the minimum capital/margin required and not the level of capital/margin required at which property and casualty companies must operate. The MCT Guideline applies to Canadian property and casualty insurance companies and foreign property and casualty companies operating in Canada on a branch basis, collectively referred to as P&C insurers. The key changes to the MCT guideline, compared to the June 2018 draft version, include the following:

    • The introduction of a transition period for the increase in the margin required for reinsurance ceded to unregistered reinsurers from 15% to 20%
    • Amendments to allow the return of excess funds withheld or collateral associated with reinsurance ceded to unregistered reinsurers
    • The addition of three credit rating agencies to the list of recognized rating agencies

     

    Related Links

    Effective Date: January 01, 2019

    Keywords: Americas, Canada, Insurance, Property and Casualty Insurance, MCT Guideline, Capital Requirements, IFRS 16, Guideline B-5, OSFI

    Related Articles
    News

    MAS Concludes Blockchain Payments Prototype Shows Commercial Potential

    MAS and Temasek jointly released a report to mark the successful conclusion of the fifth and final phase of Project Ubin, which focused on building a blockchain-based multi-currency payments network prototype.

    July 13, 2020 WebPage Regulatory News
    News

    EBA Publishes Phase 2 of Technical Package on Reporting Framework 2.10

    EBA published phase 2 of the technical package on the reporting framework 2.10, providing the technical tools and specifications for implementation of EBA reporting requirements.

    July 10, 2020 WebPage Regulatory News
    News

    APRA Updates Reporting Validation Rules in July 2020

    APRA updated the lists of the Direct to APRA (D2A) validation rules for authorized deposit-taking institutions, insurers, and superannuation entities.

    July 10, 2020 WebPage Regulatory News
    News

    PRA to Partly Apply EBA Guidelines on Disclosures for COVID Measures

    PRA updated the statement that provides guidance to regulated firms on implementation of the EBA guidelines on reporting and disclosure of exposures subject to measures applied in response to the COVID-19 crisis.

    July 10, 2020 WebPage Regulatory News
    News

    EBA Updates List of Correlated Currencies Under CRR

    EBA updated the 2019 list of closely correlated currencies that was originally published in December 2013.

    July 10, 2020 WebPage Regulatory News
    News

    FASB Proposes to Delay Implementation of Insurance Contracts Standard

    FASB issued a proposed Accounting Standards Update that would grant insurance companies, adversely affected by the COVID-19 pandemic, an additional year to implement the Accounting Standards Update No. 2018-12 on targeted improvements to accounting for long-duration insurance contracts, or LDTI (Topic 944).

    July 09, 2020 WebPage Regulatory News
    News

    APRA Updates Regulatory Approach to Loan Deferrals Amid COVID Crisis

    APRA updated the regulatory approach for loans subject to repayment deferrals amid the COVID-19 crisis.

    July 09, 2020 WebPage Regulatory News
    News

    BCBS and FSB Set Out Recommendations for Benchmark Transition

    BCBS and FSB published a report on supervisory issues associated with benchmark transition.

    July 09, 2020 WebPage Regulatory News
    News

    IAIS Sets Out Recommendations for Benchmark Transition for Insurers

    IAIS published a report on supervisory issues associated with benchmark transition from an insurance perspective.

    July 09, 2020 WebPage Regulatory News
    News

    ESMA Updates Reporting Manual on European Single Electronic Format

    ESMA updated the reporting manual on the European Single Electronic Format (ESEF).

    July 09, 2020 WebPage Regulatory News
    RESULTS 1 - 10 OF 5469