Featured Product

    IA Issues QIS 2 Templates for Development of Risk-Based Capital Regime

    August 13, 2018

    IA of Hong Kong issued templates and technical specifications for the second quantitative impact study (QIS 2) on the development of risk-based capital (RBC) regime. Additionally, IA released a package of template and technical specifications on matching adjustment for insurers conducting long-term business. Authorized insurers have been requested to participate in the QIS 2 and submit the completed template(s) by November 30, 2018.

    IA released two different packages for QIS 2—one for insurers carrying on long-term business and the other for insurers carrying on general business. Composite insurers should use both packages in respect of long-term and general business. Each package contains a template collecting quantitative and qualitative data, technical specifications for the completion of the corresponding template, annex on discount rates, and a question and answer template. IA also finalized the package of template and technical specifications on matching adjustment for insurers carrying on long-term business. IA aims to collect sufficient and relevant data from the matching adjustment package to further analyze and formulate a set of eligible criteria in applying matching adjustment as well as to determine the adjusted spread methodology. Matching adjustment is an alternative discounting approach that reflects the assets held by individual companies based on their policies for asset and liability management.

    QIS 2 is important and will offer a holistic view of the solvency position of individual insurers and the insurance industry. This would form a basis for IA to move forward to the next step of moderation exercise and to perform further testing in the third QIS. While developing the RBC regime, IA is mindful of the overarching objectives, including alignment with international standards and practices, resilience of the insurance industry for the protection of policyholders, and maintaining competitiveness of the Hong Kong insurance industry. IA has maintained close dialog with the insurance industry. Taking into account the industry feedback, IA is open to explore test options, for example, on discount rate of the long-term insurance liabilities. IA has also reflected on the feedback in certain areas in QIS 2, for example, alignment with the Hong Kong Financial Reporting Standard (HKFRS) 17 on insurance contracts to a certain extent and the proposed stress levels of certain risks. This would be a continuous process of moderation exercise, aiming to strike a balance toward a pragmatic and effective approach.

     

    Related Links

    Comment Due Date: November 30, 2018

    Keywords: Asia Pacific, Hong Kong, Insurance, Risk-based Capital Regime, QIS 2, HKFRS 17, Matching Adjustment, IFRS 17, IA

    Featured Experts
    Related Articles
    News

    BCBS Consults on Principles for Operational Risk and Resilience

    BCBS is consulting on the principles for operational resilience and the revisions to the principles for sound management of operational risk for banks.

    August 06, 2020 WebPage Regulatory News
    News

    FSI Note Discusses Challenges Associated with COVID Relief Measures

    The Financial Stability Institute (FSI) of BIS published a brief note that examines the supervisory challenges associated with certain temporary regulatory relief measures introduced by BCBS and prudential authorities in response to the COVID-19 pandemic.

    August 06, 2020 WebPage Regulatory News
    News

    HKMA Announces Repayment Deferment Under Payment Holiday Scheme

    HKMA, together with the Banking Sector Small and Medium-Size Enterprise (SME) Lending Coordination Mechanism, announced a ninety-day repayment deferment for trade facilities under the Pre-approved Principal Payment Holiday Scheme.

    August 05, 2020 WebPage Regulatory News
    News

    ESRB Paper Presents Alternative Approach to EBA Stress Test Proposal

    The Advisory Scientific Committee of ESRB published a response, in the form of an Insights Paper, to the EBA proposals for reforms to the stress testing framework in EU.

    August 05, 2020 WebPage Regulatory News
    News

    MAS Announces Key Initiatives to Support Adoption of SORA

    MAS announced several initiatives to support adoption of the Singapore Overnight Rate Average (SORA), which is administered by MAS.

    August 05, 2020 WebPage Regulatory News
    News

    BoE Updates Template and Definitions for Form ER

    BoE updated the reporting template for Form ER as well as the Form ER definitions, which contain guidance on the methodology to be used in calculating annualized interest rates.

    August 05, 2020 WebPage Regulatory News
    News

    PRA to Extend Temporary High Balance Coverage Amid COVID Crisis

    PRA published the policy statement PS19/20 on the final policy for extending coverage under the Financial Services Compensation Scheme (FSCS) for Temporary High Balance.

    August 04, 2020 WebPage Regulatory News
    News

    EBA Publishes Standards on Disclosure and Reporting of MREL and TLAC

    EBA published the final draft implementing technical standards for disclosures and reporting on the minimum requirements for own funds and eligible liabilities (MREL) and the total loss-absorbing capacity (TLAC) requirements in EU.

    August 03, 2020 WebPage Regulatory News
    News

    EBA Releases Erratum for Phase 2 Package on Reporting Framework 2.10

    EBA published an erratum for the phase 2 of technical package on the reporting framework 2.10.

    August 03, 2020 WebPage Regulatory News
    News

    EC Sets Out Updated Technical Information for Solvency II Calculations

    EC published the Implementing Regulation 2020/1145, which lays down technical information for calculation of technical provisions and basic own funds.

    August 03, 2020 WebPage Regulatory News
    RESULTS 1 - 10 OF 5635