The Standard Formula Podcast | Using an Internal Model to Calculate the Solvency Capital Requirement
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Solvency II is organised around three core pillars of prudential regulation, which ensure the safety and soundness of (re)insurers, in line with the scale, nature and complexity of their business: - Pillar One focuses on...more
The PRA has released an important statement on its approach to funded reinsurance. Our view is that the statement endorses the conceptual principle that funded reinsurance (particularly to offshore counterparties) should best...more
There are two main methods of calculating the solvency capital requirement (SCR) under Solvency II, the “standard formula” and “internal model” methods: (a) The standard formula method, as its name suggests, is the default...more
The Solvency Capital Requirement (SCR) is designed to protect policyholders by helping ensure that insurers can survive difficult periods and pay claims as they fall due. It prescribes a specific level of capital that an...more
Our latest episode of “The Standard Formula” Back to Basics series explores the internal model method for calculating the Solvency Capital Requirement. Host Rob Chaplin is joined by George Belcher to dissect the advantages...more
“The value of technical provisions should correspond to the amount which another insurance or reinsurance undertaking (the reference undertaking) would be expected to require to take over and fulfil the underlying insurance...more
The primary function of an insurer is the assumption and management of insurance risk. Very commonly, this will involve an insurer passing (or ceding) risk to other (re)insurers or protection providers in the relevant market....more
Own funds is the Solvency II term for the items that constitute a (re)insurer’s regulatory capital. These are principally balance sheet items, with limited allowance for off-balance sheet items. Own funds are items that...more
The post-Brexit Solvency II reform aims for a more competitive and dynamic insurance sector in the UK. The UK government’s proposals to adapt the Solvency II regime more appropriately to the national insurance market have...more
In recent years, operational resilience has come under the spotlight of financial regulators globally, leading to a proliferation of new regulation. The sheer number of publications on this topic can be confusing for...more
Insurer capital requirements: PRA speech - The UK Prudential Regulation Authority (PRA) has published a speech by Anna Sweeney, PRA Executive Director, Insurance, titled "Goldilocks and the three pillars: how much capital is...more
On June 27, the European Commission published a report (COM(2019) 292 final) on the group supervision and capital management provisions under the Solvency II Directive (2009/138/EC)....more
European Commission Inception Impact Assessment on Legislative Proposal for EU Framework on Crowdfunding - On October 30, 2017, the European Commission published an inception impact assessment for a legislative proposal...more
Insurance Europe, a trade body comprised of insurance associations representing approximately 95% of European premium insurance income, recently issued a press release reaffirming its stance on EU proposals for harmonising...more
The UK’s Prudential Regulation Authority (PRA) has published a Consultation Paper (CP) “CP32/16 Dealing with a market turning event in the general insurance sector“. The CP attaches a draft Supervisory Statement (SS), which...more
The European Banking Authority, European Securities and Markets Authority and European Insurance and Occupational Pensions Authority (known as the Joint Committee of the European Supervisory Authorities) published an Opinion...more
SEC Adopts Business Conduct Standards for Security-Based Swap Dealers and Major Security-Based Swap Participants - On April 15, 2016, the Securities and Exchange Commission adopted final rules modifying regulations "for...more
Three new Solvency II Implementing Regulations were published in the Official Journal of the European Union on New Year’s Eve 2015 – The Commission’s Implementing Technical Standards on...more
Five Solvency II Implementing Technical Standards were published in the Official Journal of the European Union at the end of last week, and all five will come into force on 2 December 2015....more
SEC Proposes to Amend Rules Governing Its Administrative Proceedings - On September 24, the U.S. Securities and Exchange Commission (the "SEC") proposed to amend rules governing its administrative proceedings. Key...more