An introduction to Solvency II

Save this PDF as:
 WORD  PNG  TXT  JPG

Size: px
Start display at page:

Download "An introduction to Solvency II"

Transcription

1 An introduction to Solvency II Impact on your organisation The Netherlands Singapore Germany Date: October 2013 Author: Sander Ver Loren van Themaat & Bert-Jan Nauta

2 Introduction Solvency II will establish harmonised requirements across the EU Solvency II is an EU Directive aimed at protecting interests of policy holders and stability of the financial system, by ensuring financial stability (solvency) of European (re)insurance companies. The rules stipulate the minimum amounts of financial resources that (re)insurers must have in order to cover the risks to which they are exposed. Solvency I Drivers behind Solvency II The Solvency margin is the amount of regulatory capital an insurance undertaking is obliged to hold against unforeseen events. Solvency margin requirements have been introduced in A limited reform was agreed by the European Parliament and the Council in 2002, which is known as Solvency I. Primarily focused on the prudential standards for insurers and did not include requirements for risk management and governance within firms. Lack of risk sensitivity Scattered EUinsurance market Sub-optimal supervision for groups Several key risks, including market, credit and operational risk, are not properly captured. Risk measurements are not forward-looking and contain very few qualitative requirements. Ensure accurate and timely intervention by supervisors. The present EU framework sets out minimum standards that can be supplemented by additional rules at national level. Differences on a national level result in increased costs for EU insurers and policy holders and hinder competition within the EU. Gap between the way groups are managed and supervised. The current approach to the supervision of groups focused on legal entities, while in reality groups have become increasingly centralised. Lack of convergence A lack of international and cross-sectoral convergence undermines the competitiveness of EU insurers. Lack of cross-sectoral consistency also increases the possibility of regulatory arbitrage. An introduction to Solvency II 2

3 The main elements of Solvency II Increased requirements on risk management and supervision Given the weaknesses of the Solvency I regulation, Solvency II has the objectives to: deepen the integration of the EU insurance market, enhance protection of policyholders and to improve the international competitiveness. These objectives are translated into a framework which is based on three pillars. An overview of the key issues of Solvency II is provided below. Solvency II Pillars Pillar 1 Pillar 2 Pillar 3 Quantitative requirements Focus on quantitative requirements for insurers. 1. Valuation principles. The prudential balance is based on market values (of Assets & Liabilities) and gives a realistic estimate of the financial position of the insurer. 2. Capital requirements. Insurers must comply with two capital requirements: Solvency Capital Requirements (SCR) Minimum Capital Requirements (MCR) SCR are additional requirement on MCR to cover 99.5% to secure bridging one year. If capital is below SCR the supervisor may interfere. Supervisory review Focus on qualitative risk management and system of governance. 1. Risk management. Includes strategies, processes, and procedures necessary to identify, manage and report on the risks at individual and aggregated level. 2. Own Risk and Solvency Assessment (ORSA). As part of the risk management function an insurer assesses recurrently risk and solvency. 3. Capital Add-on. The Supervisor can adjust capital requirements of insurers by a so called capital add-on. Market discipline Focus on disclosure, this should enhance transparency and market discipline. Two reporting streams defined: Reports for the public (Solvency and Financial Condition Report - SFCR). Reports for the supervisor. These disclosures will encompass to various degrees: Business overview and performance Governance Valuation basis used for solvency purposes Risk and capital management Group supervision An additional layer of supervision on consolidated level in addition to individual supervision on insurers, to mitigate systematic risk. An introduction to Solvency II 3

4 Timeline & Stakeholders An on going process that affects numerous stakeholders The proposed implementation date for Solvency II was set at January 2014 and will not be met. This is primarily due to adoption to the Lisbon treaty, covered in a legislative proposal known as Omnibus II. As of today, the final draft of Omnibus II is still waiting for parliament s vote. In October 2013 it was announced that the application date is postponed to January Timeline Introduction of Solvency I, a verification and harmonization of existing EU-wide solvency requirements. Solvency II level one directive approved by the European Parliament and adopted by the European Council. Target application date November Deadline seems unrealistic given the slow progress on Omnibus II. First Quick Fix. The Commission proposes that transposition of Solvency II will be in June 2013 and application from January Application deadline 1 January, During the introduction. the demand for a second more comprehensive reform process evolved. Solvency II level one text has to be adopted to the Lisbon Treaty, A legislative proposal known as "Omnibus II will be developed. Start negotiations on Omnibus II directive (The Commission, the Council and the European Parliament) CEIOPS replaced by EIOPA. Second Quick Fix. Application date is postponed to January 2016 and Transposition date to January Who benefits with decreased chances of failing insurers? Policyholders Uniform/enhanced level of protection across EU and strengthen confidence in insurers products. Increased competition (price drops and increase in innovation). Insurers Alignment of supervisory requirements with market practices. True level playing field. International competiveness. Supervisors Better supervisory tools, enabling more timely and effective action. Sharing of tasks between solo and group supervisors. Economy as a whole Increase international competiveness of insurers. Efficient allocation of risk and capital. Decrease in cost of raising money by insurers. An introduction to Solvency II 4

5 Legend Your organisation: Key impact areas of Solvency II Solvency II has a high impact on risk related areas Compliance Develop and implement policies and procedures for ORSA test. Enhance existing control environment for increased requirements. Risk / ALM Develop capital models for capital management on SCR and MCR. Develop integrated model capability to set risk appetite tolerance. Business model Procedure to assess diversification benefit across products and business units. Data Management Enhance effective data. management system for reporting and risk. Underwriting Changes in risk appetite may affect product offering. Reporting Design reports for key stakeholders (supervisors, analyst, policyholders). Technology Infrastructure and running costs increase due to more stringent requirements. Operating model Adjust operating model across risk, actuarial, finance, compliance and audit. Develop processes and systems for additional reporting requirements. High impact Medium impact Low impact An introduction to Solvency II 5

6 How we can help you to manage the impact Functional expertise with broad project management experience We support our clients (banks, insurance companies and pension funds) in successfully translating business strategy into organisational design, optimised business processes and technology solutions. Our wide functional expertise areas result in effective and commercially relevant solutions. High impact areas Our expertise areas Risk / ALM Develop capital models for capital management on SCR and MCR. Develop integrated model capability to set risk appetite tolerance. Business model Procedure to assess diversification benefit across products and business units. Regulation Risk Management Operating model Adjust operating model across risk, actuarial, finance, compliance and audit. Develop processes and systems for additional reporting requirements. Modelling Project management Operating Models Data management Reporting Design reports for key stakeholders (supervisors, analyst, policyholders). Compliance Develop and implement policies and procedures for ORSA test. Enhance existing control environment for increased requirements. Unique mix of content driven expertise areas with experience in project management within financial institutions. Thorough insight in regulatory and risk management developments through continued training and thought leadership. An introduction to Solvency II 6

7 Focus on pillar one: quantitative requirements Solvency II has a focus on risk measures Solvency is also referred to as Basel for insurers. From a risk perspective there are strong similarities in the risk measures used within banks to those within solvency II, especially within market risk measures. Quantitative requirements on assets Solvency Capital Requirements Technical provisions Consist of best estimate value of liabilities + risk margin. Solvency Capital Requirements (SCR) Measure for quantifiable risk of insurer. Corresponds to VaR net assets at 99,5% CL on a 1 year horizon. Minimum Capital Requirements (MCR) Lower level of capital sufficiency than SCR. Threshold for immediate supervisory intervention. Market Risk quantifies the impact from various shocks: Adjustment Solvency Capital Requirements (SCR) BSCR Operational risk In scope of our risk experts Market Health Default Life Nonlife Intang Assets covering technical provisions, the MCR and the SCR Assets MCR RM BE Solvency Capital Requirements (SCR) Minimum Capital Requirements Technical Provisions Interest Rate: Equity: Property: Spread: Currency: Concentration Illiquidity: Interest-rate term structure shock Equity value shocks Real estate value shocks Credit spread shocks FX rate shocks Charge for excess counterparty concentrations 65% fall of illiquidity premium Each shock is calibrated such that it corresponds to the required Value-at- Risk at 99.5% C.L. on a 1-year horizon. Shock scenarios are provided by QIS5 technical specifications (here we refer to version 5 July 2010). An introduction to Solvency II 7

8 Our track record A sample of our experience, covering the entire risk value chain Double Effect is uniquely qualified to solve the challenges insurers face. We know the business, we are content driven, and we are always ready to go the extra mile to exceed our clients expectations. Our experience covers the entire value chain of risk and regulatory driven projects within financial institutions. Track record Our offering Data management Implementation of a golden source system for FX, interest rate and security related instruments for a large Dutch bank. Strategy translation Strategic analysis and operating model definition. Ability to work across the entire value chain. Pricing / modelling Risk Development of a multi-curve pricing tool for interest rate and FX derivatives. Assessment of new regulation on existing risk organisation, reporting, processes, policies. Tailor made solutions Drive best practice from our industry experience. Deliver tailor made solutions to maximise client value. Economic Capital Enhanced an EC model from using regulatory exposures to modelled exposures. Mixed teams We build mixed teams with the client, mobilising the combined experience to get the best solutions. Reporting In the lead of a project for a regulatory capital calculator and reporting tool, which resulted in significantly lower RWA capital. Business results Business case driven and fact based decision making. Project management to deliver business results. An introduction to Solvency II 8

9 Who we are Our core values determine the way we work A financial services specialist with an entrepreneurial spirit. Over 75 consultants based in Amsterdam, Singapore and Frankfurt who all share the same core values. We want to fully understand our client s business in order to add value with our commitment and advice. Client and result driven Quality resulting from intrinsic motivation Understand customer needs. Act in the client s best interest. Be reliable. Be responsible and proactive. Intrinsic drive to excel. Never stop asking. 4 eye principle. Assertive & proactive. Our Core Values Growth through teamwork We instead of I. Coaching on the job. Challenge each other. Open for feedback. Integrity, clarity & authenticity Be transparent and open. Clear and direct communication. Share successes and failures. Embrace diversity. Work hard, play hard together Celebrate successes. Join and initiate events. Accessible and positive. Take care of each other. An introduction to Solvency II 9

10 Want to know more? Please contact one of our Solvency II experts Mark Tuente Practice Lead Insurance Sander ver Loren van Themaat Consultant Risk Mark Barten Consultant Double Effect Hullenbergweg CP Amsterdam The Netherlands Phone Double Effect Singapore Phone Double Effect Germany Phone An introduction to Solvency II 10

Solvency II Towards a risk based system

Solvency II Towards a risk based system Solvency II Towards a risk based system Gabriel Bernardino EIOPA Chairman Webinar P/C Risk-Based Capital: State and International Solvency Regulation May 31, 2011 Towards a single rulebook Crucial step

More information

Solvency II Update. Nick Dexter. 24 November 2011

Solvency II Update. Nick Dexter. 24 November 2011 Solvency II Update Nick Dexter 24 November 2011 Agenda Solvency II Overview Current Status of Solvency II Own Risk and Solvency Assessment Solvency II v Canadian regime 2 Solvency II Overview Solvency

More information

Solvency II. Integrating the financial and non-financial aspects. March 26, Presented by Andrew Kay

Solvency II. Integrating the financial and non-financial aspects. March 26, Presented by Andrew Kay Solvency II Integrating the financial and non-financial aspects Presented by Andrew Kay March 26, 2010 Agenda Pillar 1 What are the financials i telling you? Pillar 2 Governance and organisation Management

More information

Solvency II for Beginners 16.05.2013

Solvency II for Beginners 16.05.2013 Solvency II for Beginners 16.05.2013 Agenda Why has Solvency II been created? Structure of Solvency II The Solvency II Balance Sheet Pillar II & III Aspects Where are we now? Solvency II & Actuaries Why

More information

An update on QIS5. Agenda 4/27/2010. Context, scope and timelines The draft Technical Specification Getting into gear Questions

An update on QIS5. Agenda 4/27/2010. Context, scope and timelines The draft Technical Specification Getting into gear Questions A Closer Look at Solvency II Eleanor Beamond-Pepler, FSA An update on QIS5 2010 The Actuarial Profession www.actuaries.org.uk Agenda Context, scope and timelines The draft Technical Specification Getting

More information

Solvency ii: an overview. Lloyd s July 2010

Solvency ii: an overview. Lloyd s July 2010 Solvency ii: an overview Lloyd s July 2010 Contents Solvency II: key features Legislative process Solvency II implementation Conclusions 2 Solvency II: key features 3 Solvency II the basics Introduces

More information

Solvency II overview

Solvency II overview David Payne, FIA Casualty Loss Reserve Seminar 15 September 2011 INTNL-2: Solvency II Update Antitrust Notice The Casualty Actuarial Society is committed to adhering strictly to the letter and spirit of

More information

Solvency II. Solvency II implemented on 1 January 2016. Why replace Solvency I? To which insurance companies does the new framework apply?

Solvency II. Solvency II implemented on 1 January 2016. Why replace Solvency I? To which insurance companies does the new framework apply? Solvency II A new framework for prudential supervision of insurance companies 1 Solvency II implemented on 1 January 2016. 1 January 2016 marks the introduction of Solvency II, a new framework for the

More information

Texts passed by the European Council and Parliament Adapted by Member States

Texts passed by the European Council and Parliament Adapted by Member States Introduction A few words about European Directives Texts passed by the European Council and Parliament Adapted by Member States Insurance law: What is going on? A draft directive under discussion = SOLVENCY

More information

INVESTMENT FUNDS: Funds investments. KPMG Business DialogueS November 4 th 2011

INVESTMENT FUNDS: Funds investments. KPMG Business DialogueS November 4 th 2011 INVESTMENT FUNDS: Impact of Solvency II Directive on Funds investments KPMG Business DialogueS November 4 th 2011 Map of the presentation Introduction The first consequences for asset managers and investors

More information

Insurance Groups under Solvency II

Insurance Groups under Solvency II Insurance Groups under Solvency II November 2013 Table of Contents 1. Introduction... 2 2. Defining an insurance group... 2 3. Cases of application of group supervision... 6 4. The scope of group supervision...

More information

EIOPA s Public Consultation Guidelines for the Preparation of Solvency II - System of Governance & ORSA. 9 April 2013

EIOPA s Public Consultation Guidelines for the Preparation of Solvency II - System of Governance & ORSA. 9 April 2013 1 EIOPA s Public Consultation Guidelines for the Preparation of Solvency II - System of Governance & ORSA 9 April 2013 2 Agenda 1. Objectives 4 2. Introduction The Consultation Process & Background 5-6

More information

Implementation of Solvency II: The dos and the don ts

Implementation of Solvency II: The dos and the don ts KEYNOTE SPEECH Gabriel Bernardino Chairman of EIOPA Implementation of Solvency II: The dos and the don ts International conference Solvency II: What Can Go Wrong? Ljubljana, 2 September 2015 Page 2 of

More information

Solvency II Impacts on asset managers and servicers

Solvency II Impacts on asset managers and servicers www.pwc.lu/insurance Solvency II Impacts on asset managers and servicers The Omnibus II proposal will amend the Solvency II Directive voted in 2009. It would probably defer full Solvency II implementation

More information

Actuarial Discipline: Threat or Opportunity?

Actuarial Discipline: Threat or Opportunity? Actuarial Discipline: Threat or Opportunity? Risk and Investment Conference Brighton, 17 June 2013 Prof. Karel Van Hulle KU Leuven and Goethe University Frankfurt Actuarial Discipline The importance of

More information

FRAMEWORK FOR CONSULTATION OF CEIOPS AND OTHER STAKEHOLDERS ON SOLVENCY II

FRAMEWORK FOR CONSULTATION OF CEIOPS AND OTHER STAKEHOLDERS ON SOLVENCY II Annex 1 to MARKT/2506/04-EN FRAMEWORK FOR CONSULTATION OF CEIOPS AND OTHER STAKEHOLDERS ON SOLVENCY II Purpose of this document The purpose of this paper is to consult the Insurance Committee on a framework

More information

Solvency Management in Life Insurance The company s perspective

Solvency Management in Life Insurance The company s perspective Group Risk IAA Seminar 19 April 2007, Mexico City Uncertainty Exposure Solvency Management in Life Insurance The company s perspective Agenda 1. Key elements of Allianz Risk Management framework 2. Drawbacks

More information

ORSA - The heart of Solvency II

ORSA - The heart of Solvency II ORSA - The heart of Solvency II Groupe Consultatif Summer School Gabriel Bernardino, EIOPA Lisbon, 25 May 2011 ORSA - The heart of Solvency II Developing the regulatory framework for Solvency II ORSA it

More information

Regulations in General Insurance. Solvency II

Regulations in General Insurance. Solvency II Regulations in General Insurance Solvency II Solvency II What is it? Solvency II is a new risk-based regulatory requirement for insurance, reinsurance and bancassurance (insurance) organisations that operate

More information

Gabriel Bernardino Chairman of EIOPA

Gabriel Bernardino Chairman of EIOPA Solvency II status update Gabriel Bernardino Chairman of EIOPA KPMG Czech Republic Solvency Conference KPMG Czech Republic Solvency Conference Prague, 12 April 2012 Where is Solvency II? Directive (O.J.

More information

Introduction to Solvency II

Introduction to Solvency II Introduction to Solvency II Tim Edwards Gavin Dunkerley 24 th September 2008 Introduction The primary purpose of this presentation is to explain what Solvency II is and why it is important We also hope

More information

Solvency II Standard Model for Health Insurance Business

Solvency II Standard Model for Health Insurance Business Solvency II Standard Model for Health Insurance Business Hanno Reich KPMG AG, Germany kpmg Agenda 1. Solvency II Project 2. Future regulatory framework (Solvency II) 3. Calculation of Solvency Capital

More information

SOLVENCY II LIFE INSURANCE

SOLVENCY II LIFE INSURANCE SOLVENCY II LIFE INSURANCE 1 Overview 1.1 Background and scope The current UK regulatory reporting regime is based on the EU Solvency I Directives. Although the latest of those Directives was implemented

More information

Guidelines on the implementation of the long-term guarantee measures

Guidelines on the implementation of the long-term guarantee measures EIOPA-BoS-15/111 EN Guidelines on the implementation of the long-term guarantee measures EIOPA Westhafen Tower, Westhafenplatz 1-60327 Frankfurt Germany - Tel. + 49 69-951119-20; Fax. + 49 69-951119-19;

More information

SCOR inform - April 2012. Life (re)insurance under Solvency II

SCOR inform - April 2012. Life (re)insurance under Solvency II SCOR inform - April 2012 Life (re)insurance under Solvency II Life (re)insurance under Solvency II Author Thorsten Keil SCOR Global Life Cologne Editor Bérangère Mainguy Tel: +33 (0)1 58 44 70 00 Fax:

More information

Solvency II New Framework for Risk Management Organisation. Dr. Maciej Sterzynski (Triglav Insurance, Ltd.) Matija Bitenc (Triglav Insurance, Ltd.

Solvency II New Framework for Risk Management Organisation. Dr. Maciej Sterzynski (Triglav Insurance, Ltd.) Matija Bitenc (Triglav Insurance, Ltd. Solvency II New Framework for Risk Management Organisation Dr. Maciej Sterzynski (Triglav Insurance, Ltd.) Matija Bitenc (Triglav Insurance, Ltd.) 1 AGENDA ð Understanding Solvency II ð Setting up Integrated

More information

EIOPACP 13/011. Guidelines on PreApplication of Internal Models

EIOPACP 13/011. Guidelines on PreApplication of Internal Models EIOPACP 13/011 Guidelines on PreApplication of Internal Models EIOPA Westhafen Tower, Westhafenplatz 1 60327 Frankfurt Germany Tel. + 49 6995111920; Fax. + 49 6995111919; site: www.eiopa.europa.eu Guidelines

More information

SOLVENCY II HEALTH INSURANCE

SOLVENCY II HEALTH INSURANCE 2014 Solvency II Health SOLVENCY II HEALTH INSURANCE 1 Overview 1.1 Background and scope The current UK regulatory reporting regime is based on the EU Solvency I Directives. Although the latest of those

More information

OWN RISK AND SOLVENCY ASSESSMENT AND ENTERPRISE RISK MANAGEMENT

OWN RISK AND SOLVENCY ASSESSMENT AND ENTERPRISE RISK MANAGEMENT OWN RISK AND SOLVENCY ASSESSMENT AND ENTERPRISE RISK MANAGEMENT ERM as the foundation for regulatory compliance and strategic business decision making CONTENTS Introduction... 3 Steps to developing an

More information

Guidelines on ring-fenced funds

Guidelines on ring-fenced funds EIOPA-BoS-14/169 EN Guidelines on ring-fenced funds EIOPA Westhafen Tower, Westhafenplatz 1-60327 Frankfurt Germany - Tel. + 49 69-951119-20; Fax. + 49 69-951119-19; email: info@eiopa.europa.eu site: https://eiopa.europa.eu/

More information

International Financial Reporting for Insurers: IFRS and U.S. GAAP September 2009 Session 25: Solvency II vs. IFRS

International Financial Reporting for Insurers: IFRS and U.S. GAAP September 2009 Session 25: Solvency II vs. IFRS International Financial Reporting for Insurers: IFRS and U.S. GAAP September 2009 Session 25: Solvency II vs. IFRS Simon Walpole Solvency II Simon Walpole Solvency II Agenda Introduction to Solvency II

More information

Consultation Paper on the Proposal for Guidelines on submission of information to national competent authorities

Consultation Paper on the Proposal for Guidelines on submission of information to national competent authorities EIOPA-CP-13/010 27 March 2013 Consultation Paper on the Proposal for Guidelines on submission of information to national competent authorities Page 1 of 268 Table of Contents Responding to this paper...

More information

Final Report on Public Consultation No. 14/017 on Guidelines on own risk and solvency assessment

Final Report on Public Consultation No. 14/017 on Guidelines on own risk and solvency assessment EIOPA-BoS-14/259 28 January 2015 Final Report on Public Consultation No. 14/017 on Guidelines on own risk and solvency assessment EIOPA Westhafen Tower, Westhafenplatz 1-60327 Frankfurt Germany - Tel.

More information

Insurance Guidance Note No. 14 System of Governance - Insurance Transition to Governance Requirements established under the Solvency II Directive

Insurance Guidance Note No. 14 System of Governance - Insurance Transition to Governance Requirements established under the Solvency II Directive Insurance Guidance Note No. 14 Transition to Governance Requirements established under the Solvency II Directive Date of Paper : 31 December 2013 Version Number : V1.00 Table of Contents General governance

More information

Guidelines on own risk and solvency assessment

Guidelines on own risk and solvency assessment EIOPA-BoS-14/259 EN Guidelines on own risk and solvency assessment EIOPA Westhafen Tower, Westhafenplatz 1-60327 Frankfurt Germany - Tel. + 49 69-951119-20; Fax. + 49 69-951119-19; email: info@eiopa.europa.eu

More information

Solvency II. Impacts on asset managers and servicers. Financial Services Asset Management. www.pwc.com/it

Solvency II. Impacts on asset managers and servicers. Financial Services Asset Management. www.pwc.com/it Financial Services Asset Management Solvency II Impacts on asset managers and servicers The Omnibus II proposal will amend the Solvency II Directive voted in 2009. It would probably defer full Solvency

More information

Industry Briefing on Central Bank Guidelines on Preparing for Solvency II

Industry Briefing on Central Bank Guidelines on Preparing for Solvency II Industry Briefing on Central Bank Guidelines on Preparing for Solvency II 25 November 2013 Agenda 1. Central Bank Guidelines on preparing for Solvency II 2.Q&A session Central Bank Guidelines on preparing

More information

INTERNATIONAL ASSOCIATION OF INSURANCE SUPERVISORS

INTERNATIONAL ASSOCIATION OF INSURANCE SUPERVISORS Standard No. 13 INTERNATIONAL ASSOCIATION OF INSURANCE SUPERVISORS STANDARD ON ASSET-LIABILITY MANAGEMENT OCTOBER 2006 This document was prepared by the Solvency and Actuarial Issues Subcommittee in consultation

More information

1. INTRODUCTION AND PURPOSE

1. INTRODUCTION AND PURPOSE Solvency Assessment and Management: Pillar 1 - Sub Committee Capital Requirements Task Group Discussion Document 73 (v 2) Treatment of new business in SCR EXECUTIVE SUMMARY As for the Solvency II Framework

More information

SOLVENCY II HEALTH INSURANCE

SOLVENCY II HEALTH INSURANCE 2016 Solvency II Health SOLVENCY II HEALTH INSURANCE 1 Overview 1.1 Background and scope The key objectives of Solvency II were to increase the level of harmonisation of solvency regulation across Europe,

More information

Consultation Paper CP43/15 Solvency II: external audit of the public disclosure requirement

Consultation Paper CP43/15 Solvency II: external audit of the public disclosure requirement Consultation Paper CP43/15 Solvency II: external audit of the public disclosure requirement November 2015 Prudential Regulation Authority 20 Moorgate London EC2R 6DA Prudential Regulation Authority, registered

More information

From ICAAP/ORSA to ERM: Board and Senior Management Oversight. Leon Bloom, Partner, Deloitte & Touche LLP lebloom@deloitte.ca

From ICAAP/ORSA to ERM: Board and Senior Management Oversight. Leon Bloom, Partner, Deloitte & Touche LLP lebloom@deloitte.ca From ICAAP/ORSA to ERM: Board and Senior Management Oversight Leon Bloom, Partner, Deloitte & Touche LLP lebloom@deloitte.ca Agenda Basel II ICAAP Solvency II ORSA ERM From ICAAP/ORSA to ERM: Governance

More information

EIOPA-CP-11/008 7 November 2011. Consultation Paper On the Proposal for Guidelines on Own Risk and Solvency Assessment

EIOPA-CP-11/008 7 November 2011. Consultation Paper On the Proposal for Guidelines on Own Risk and Solvency Assessment EIOPA-CP-11/008 7 November 2011 Consultation Paper On the Proposal for Guidelines on Own Risk and Solvency Assessment EIOPA Westhafen Tower, Westhafenplatz 1-60327 Frankfurt Germany - Tel. + 49 69-951119-20;

More information

Quick Solvency II Technical Reporting Guide. Pillar 3: What, Who and When

Quick Solvency II Technical Reporting Guide. Pillar 3: What, Who and When Quick Solvency II Technical Reporting Guide illar 3: What, Who and When Contents Introduction 2 Solvency II in Brief 2 Who will be subject to Solvency II? 3 What are the Solvency II key requirements? 3

More information

ORSA for Insurers A Global Concept

ORSA for Insurers A Global Concept ORSA for Insurers A Global Concept Stuart Wason, FSA, FCIA, MAAA, CERA Senior Director, Actuarial Division Office of the Superintendent of Financial Institutions Canada (OSFI) Table of Contents Early developments

More information

EIOPACP 13/09. Guidelines on Forward Looking assessment of own risks (based on the ORSA principles)

EIOPACP 13/09. Guidelines on Forward Looking assessment of own risks (based on the ORSA principles) EIOPACP 13/09 Guidelines on Forward Looking assessment of own risks (based on the ORSA principles) EIOPA Westhafen Tower, Westhafenplatz 1 60327 Frankfurt Germany Tel. + 49 6995111920; Fax. + 49 6995111919;

More information

Solvency II in practice. Speaker: Tim O Hanrahan Deputy Head, Insurance, Central Bank of Ireland 16 March 2016

Solvency II in practice. Speaker: Tim O Hanrahan Deputy Head, Insurance, Central Bank of Ireland 16 March 2016 1 Solvency II in practice Speaker: Tim O Hanrahan Deputy Head, Insurance, Central Bank of Ireland 16 March 2016 1 Recap on Solvency II Regulatory Framework under Solvency II Pillar I - Capital Pillar II

More information

KBC Group Solvency II External Communication. KBC Group - Investor Relations Office

KBC Group Solvency II External Communication. KBC Group - Investor Relations Office KBC Group Solvency II External Communication More infomation: www.kbc.com KBC Group - Investor Relations Office Email: investor.relations@kbc.com 1 Contents 1 Solvency II : From SI to SII at KBC 2 Key

More information

System of Governance

System of Governance CEIOPS-DOC-29/09 CEIOPS Advice for Level 2 Implementing Measures on Solvency II: System of Governance (former Consultation Paper 33) October 2009 CEIOPS e.v. Westhafenplatz 1-60327 Frankfurt Germany Tel.

More information

Positioning the internal audit function within the Solvency II framework Key challenges. Ludovic Bardon Senior Manager Audit Deloitte Luxembourg

Positioning the internal audit function within the Solvency II framework Key challenges. Ludovic Bardon Senior Manager Audit Deloitte Luxembourg Positioning the internal audit function within the Solvency II framework Key challenges Jérôme Sosnowski Director Governance, Risk & Compliance Deloitte Luxembourg Ludovic Bardon Senior Manager Audit Deloitte

More information

Solvency II: Implications for Loss Reserving

Solvency II: Implications for Loss Reserving Solvency II: Implications for Loss Reserving John Charles Doug Collins CLRS: 12 September 2006 Agenda Solvency II Introduction Pre-emptive adopters Solvency II concepts Quantitative Impact Studies Internal

More information

Capital Management in a Solvency II World & the Role of Reinsurance

Capital Management in a Solvency II World & the Role of Reinsurance Capital Management in a Solvency II World & the Role of Reinsurance Paolo de Martin CEO SCOR Global Life IAA Colloquium Oslo June 2015 Overview Why I Focus today on Capital Management? Reminder key objectives

More information

Capital requirements for health insurance under Solvency II

Capital requirements for health insurance under Solvency II Capital requirements for health insurance under Solvency II Medical Expense Insurance: Actuarial Aspects and Solvency Afternoon Seminar at the AG Insurance Chair in Health Insurance, KU Leuven 25 April

More information

Solvency II Pillar III Quantitative Reporting Templates (QRTs) Sinead Clarke, Eoin King 11 th December 2012

Solvency II Pillar III Quantitative Reporting Templates (QRTs) Sinead Clarke, Eoin King 11 th December 2012 Solvency II Pillar III Quantitative Reporting Templates (QRTs) Sinead Clarke, Eoin King 11 th December 2012 Agenda Introduction and Background Summary of QRTs Reporting Timelines and Next Steps Questions

More information

Interview with Gabriel Bernardino, Chairman of EIOPA, conducted by Fabrizio Aurilia, the Insurance Review (Italy)

Interview with Gabriel Bernardino, Chairman of EIOPA, conducted by Fabrizio Aurilia, the Insurance Review (Italy) Interview with Gabriel Bernardino, Chairman of EIOPA, conducted by Fabrizio Aurilia, the Insurance Review (Italy) 1. Since EIOPA was established, how has the role of European supervision of the insurance

More information

Preparing for ORSA - Some practical issues Speaker:

Preparing for ORSA - Some practical issues Speaker: 2013 Seminar for the Appointed Actuary Colloque pour l actuaire désigné 2013 Session 13: Preparing for ORSA - Some practical issues Speaker: André Racine, Principal Eckler Ltd. Context of ORSA Agenda Place

More information

Solvency II Advanced Workshop

Solvency II Advanced Workshop Solvency II Advanced Workshop Tim Edwards James Orr 25 th September 2008 Introduction This presentation provides an update on progress towards Solvency II: Timeline Results of the QIS4 exercise Publication

More information

Insurance Roadshow London, October 2008. Solvency 2 Update

Insurance Roadshow London, October 2008. Solvency 2 Update Insurance Roadshow London, October 2008 Solvency 2 Update Agenda Progress to date Overview of key component of Solvency 2 Further issues for discussion Impact on ratings Solvency 2 - What s new? Progress

More information

COMMISSION DELEGATED DECISION (EU) / of 5.6.2015

COMMISSION DELEGATED DECISION (EU) / of 5.6.2015 EUROPEAN COMMISSION Brussels, 5.6.2015 C(2015) 3740 final COMMISSION DELEGATED DECISION (EU) / of 5.6.2015 on the provisional equivalence of the solvency regimes in force in Australia, Bermuda, Brazil,

More information

Solvency II and key considerations for asset managers

Solvency II and key considerations for asset managers 120 Solvency II and key considerations for asset managers Thierry Flamand Partner Insurance Leader Deloitte Luxembourg Xavier Zaegel Partner Financial Risks Leader Deloitte Luxembourg Sylvain Crepin Director

More information

CRO Forum Paper on the Own Risk and Solvency Assessment (ORSA): Leveraging regulatory requirements to generate value. May 2012.

CRO Forum Paper on the Own Risk and Solvency Assessment (ORSA): Leveraging regulatory requirements to generate value. May 2012. CRO Forum Paper on the Own Risk and Solvency Assessment (ORSA): Leveraging regulatory requirements to generate value May 2012 May 2012 1 1. Introduction 1.1. Purpose of the paper In this discussion paper

More information

Solvency II the path to 2016

Solvency II the path to 2016 Solvency II the path to 2016 Financial Services Faculty webinar 21 January 2014 BUSINESS WITH CONFIDENCE icaew.com Introduction Janine Hawes Insurance Director and technical leader on Solvency II KPMG

More information

Consultation Paper CP22/16 Solvency II: Monitoring model drift and standard formula SCR reporting for firms with an approved internal model

Consultation Paper CP22/16 Solvency II: Monitoring model drift and standard formula SCR reporting for firms with an approved internal model Consultation Paper CP22/16 Solvency II: Monitoring model drift and standard formula SCR reporting for firms with an approved internal model May 2016 Prudential Regulation Authority 20 Moorgate London EC2R

More information

Central Bank of Ireland Guidelines on Preparing for Solvency II Pre-application for Internal Models

Central Bank of Ireland Guidelines on Preparing for Solvency II Pre-application for Internal Models 2013 Central Bank of Ireland Guidelines on Preparing for Solvency II Pre-application for Internal Models 1 Contents 1 Context... 1 2 General... 2 3 Guidelines on Pre-application for Internal Models...

More information

Society of Actuaries in Ireland

Society of Actuaries in Ireland Society of Actuaries in Ireland Information and Assistance Note LA-1: Actuaries involved in the Own Risk & Solvency Assessment (ORSA) under Solvency II Life Assurance and Life Reinsurance Business Issued

More information

Consultation Paper on the draft proposal for Guidelines on methods for determining the market share for reporting

Consultation Paper on the draft proposal for Guidelines on methods for determining the market share for reporting EIOPA-CP-14/044 27 November 2014 Consultation Paper on the draft proposal for Guidelines on methods for determining the market share for reporting EIOPA Westhafen Tower, Westhafenplatz 1-60327 Frankfurt

More information

Actuarial Risk Management

Actuarial Risk Management ARA syllabus Actuarial Risk Management Aim: To provide the technical skills to apply the principles and methodologies studied under actuarial technical subjects for the identification, quantification and

More information

CEIOPS Advice for Level 2 Implementing Measures on Solvency II: Articles 120 to 126. Tests and Standards for Internal Model Approval

CEIOPS Advice for Level 2 Implementing Measures on Solvency II: Articles 120 to 126. Tests and Standards for Internal Model Approval CEIOPS-DOC-48/09 CEIOPS Advice for Level 2 Implementing Measures on Solvency II: Articles 120 to 126 Tests and Standards for Internal Model Approval (former Consultation Paper 56) October 2009 CEIOPS e.v.

More information

Solvency II implementation - beyond compliance

Solvency II implementation - beyond compliance KEYNOTE SPEECH Gabriel Bernardino Chairman of the European Insurance and Occupational Pensions Authority (EIOPA) Solvency II implementation - beyond compliance IVASS Conference 2016 The Launch of Solvency

More information

Central Bank of Ireland Guidelines on Preparing for Solvency II System of Governance

Central Bank of Ireland Guidelines on Preparing for Solvency II System of Governance 2013 Central Bank of Ireland Guidelines on Preparing for Solvency II System of Governance Contents 1 Context... 1 2 General... 2 3 Guidelines on the System of Governance... 3 3.1 Section I General Provisions...

More information

Making it clear Reporting and disclosure in the Solvency II world

Making it clear Reporting and disclosure in the Solvency II world Making it clear Reporting and disclosure in the Solvency II world The Solvency II Directive is built around the 3 pillars of quantitative requirements (Pillar 1), supervisory review (Pillar 2) and disclosure

More information

Solvency I update. Gui Iglesias KPMG in the UK

Solvency I update. Gui Iglesias KPMG in the UK Solvency I update Gui Iglesias KPMG in the UK 23 June 2016 What is Solvency II? Solvency II New EU Regulation effective 01/01/2016, designed to Provide greater protection to policyholders through an enhanced

More information

Guidelines on exchange of information on a systematic basis within colleges

Guidelines on exchange of information on a systematic basis within colleges EIOPA-BoS-15/112 EN Guidelines on exchange of information on a systematic basis within colleges EIOPA Westhafen Tower, Westhafenplatz 1-60327 Frankfurt Germany - Tel. + 49 69-951119-20; Fax. + 49 69-951119-19;

More information

Key functions in the system of governance Responsibilities, interfaces and outsourcing under Solvency II

Key functions in the system of governance Responsibilities, interfaces and outsourcing under Solvency II Responsibilities, interfaces and outsourcing under Solvency II Author Lars Moormann Contact solvency solutions@munichre.com January 2013 2013 Münchener Rückversicherungs Gesellschaft Königinstrasse 107,

More information

Position paper on. Treatment of captives in SOLVENCY II

Position paper on. Treatment of captives in SOLVENCY II Position paper on Treatment of captives in SOLVENCY II 1 INTRODUCTION...3 2 NATURE AND RATIONALE OF CAPTIVES...3 2.1 Captive Objectives...3 3 THE SOLVENCY II OBJECTIVES...5 EU OBJECTIVE 1: Improve protection

More information

Solvency II Conference. 29 November 2011

Solvency II Conference. 29 November 2011 Solvency II Conference 29 November 2011 Agenda Topic Opening Remarks Update on Solvency II Programme European Context and Local Perspective Overview of Pillar 1 Coffee Break Move to Breakout Rooms Breakout

More information

SOLVENCY II LIFE INSURANCE

SOLVENCY II LIFE INSURANCE 2016 Solvency II Life SOLVENCY II LIFE INSURANCE 1 Overview 1.1 Background and scope The key objectives of Solvency II were to increase the level of harmonisation of solvency regulation across Europe,

More information

THE INSURANCE BUSINESS (SOLVENCY) RULES 2015

THE INSURANCE BUSINESS (SOLVENCY) RULES 2015 THE INSURANCE BUSINESS (SOLVENCY) RULES 2015 Table of Contents Part 1 Introduction... 2 Part 2 Capital Adequacy... 4 Part 3 MCR... 7 Part 4 PCR... 10 Part 5 - Internal Model... 23 Part 6 Valuation... 34

More information

ERM in Insurance (Solvency II) Special Interest Group

ERM in Insurance (Solvency II) Special Interest Group ERM in Insurance (Solvency II) Special Interest Group Linking ORSA and business planning Embedding risk management in decision making Jacqueline Fenech, Director 29 May 2013 Agenda The ugly truth The not

More information

on Asset Management Management

on Asset Management Management 2008 Guidelines for for Insurance Insurance Undertakings Undertakings on Asset on Asset Management Management 2 Contents Context...3 1. General...3 2. Introduction...3 3. Regulations and guidelines for

More information

'SOLVENCY II': Frequently Asked Questions (FAQs)

'SOLVENCY II': Frequently Asked Questions (FAQs) EUROPEAN COMMISSION Internal Market and Services DG FINANCIAL INSTITUTIONS Insurance and pensions 'SOLVENCY II': Frequently Asked Questions (FAQs) 1. Why does the EU need harmonised solvency rules? The

More information

Society of Actuaries in Ireland Solvency II - Pillar III Brian Morrissey. 22 June 2011

Society of Actuaries in Ireland Solvency II - Pillar III Brian Morrissey. 22 June 2011 Society of Actuaries in Ireland Solvency II - Pillar III Brian Morrissey 22 June 2011 Agenda The focus of Solvency II presentations to date has focused on Pillar I (technical provisions and capital requirements)

More information

LIFE INSURANCE RATING METHODOLOGY CREDIT RATING AGENCY OF

LIFE INSURANCE RATING METHODOLOGY CREDIT RATING AGENCY OF LIFE INSURANCE RATING METHODOLOGY CREDIT RATING AGENCY OF BANGLADESH LIMITED 1 CRAB S RATING PROCESS An independent and professional approach of the CRAB is designed to ensure reliable, consistent and

More information

UAE insurance market leads the way with long-awaited Prudential Regulations

UAE insurance market leads the way with long-awaited Prudential Regulations INSIGHT UAE insurance market leads the way with long-awaited Prudential Regulations July 12, 2015 Written by Peter Hodgins and Liesel van den Heever In the first of a series of articles on the Financial

More information

Solvency II Examining Maximum Harmonisation

Solvency II Examining Maximum Harmonisation Solvency II Examining Maximum Harmonisation Ramona Dolan Sarah Byrne 20 November 2015 Concept of Maximum Harmonisation Key objective of Solvency II is to address the regulatory arbitrage that existed under

More information

Preparing for Solvency II Time for asset managers and asset servicers to act. Thierry Flamand Partner Advisory & Consulting Deloitte

Preparing for Solvency II Time for asset managers and asset servicers to act. Thierry Flamand Partner Advisory & Consulting Deloitte Preparing for Solvency II Time for asset managers and asset servicers to act Thierry Flamand Partner Advisory & Consulting Deloitte Michael Cravatte Director Advisory & Consulting Deloitte The insurance

More information

Solvency II, the practical implications for asset managers and insurers

Solvency II, the practical implications for asset managers and insurers www.pwc.nl/nl/asset-management Solvency II, the practical implications for asset managers and insurers December 2014 Introduction Solvency II is the most significant change for the European (re)insurance

More information

Guidelines on operational functioning of colleges

Guidelines on operational functioning of colleges EIOPA-BoS-14/146 EN Guidelines on operational functioning of colleges EIOPA Westhafen Tower, Westhafenplatz 1-60327 Frankfurt Germany - Tel. + 49 69-951119-20; Fax. + 49 69-951119-19; email: info@eiopa.europa.eu

More information

Hot Topic FS Regulatory Centre of Excellence, 2 December 2013. Hot Topic. Solvency II requirements published

Hot Topic FS Regulatory Centre of Excellence, 2 December 2013. Hot Topic. Solvency II requirements published Hot Topic Hot Topic Solvency II requirements published The publication of the Omnibus II text provides much needed clarity to the market on some key topics FS Regulatory Centre of Excellence 2 December

More information

IOPS GOOD PRACTICES IN RISK MANAGEMENT OF ALTERNATIVE INVESTMENTS BY PENSION FUNDS

IOPS GOOD PRACTICES IN RISK MANAGEMENT OF ALTERNATIVE INVESTMENTS BY PENSION FUNDS . IOPS GOOD PRACTICES IN RISK MANAGEMENT OF ALTERNATIVE INVESTMENTS BY PENSION FUNDS June 2010 1 GOOD PRACTICES IN RISK MANAGEMENT OF ALTERNATIVE INVESTMENTS BY PENSION FUNDS 1 Introduction 1. The objective

More information

Solvency Assessment and Management: Capital Requirements Discussion Document 58 (v 3) SCR Structure Credit and Counterparty Default Risk

Solvency Assessment and Management: Capital Requirements Discussion Document 58 (v 3) SCR Structure Credit and Counterparty Default Risk Solvency Assessment and Management: Capital Requirements Discussion Document 58 (v 3) SCR Structure Credit and Counterparty Default Risk EXECUTIVE SUMMARY Solvency II allows for credit and counterparty

More information

Regulatory Solvency Assessment of Property/Casualty Insurance Companies in the United States

Regulatory Solvency Assessment of Property/Casualty Insurance Companies in the United States Regulatory Solvency Assessment of Property/Casualty Insurance Companies in the United States A presentation by Robert F. Conger Past-President, Casualty Actuarial Society September 2013 Regulatory Solvency

More information

Public reporting in a Solvency II environment

Public reporting in a Solvency II environment Public in a Survey report August 014 kpmg.co.uk 0 PUBLIC REPORTING IN A SOLVENCY ENVIRONMENT Contents Page 1 4 5 Introduction Executive Summary Public Disclosures 4 Changes to Financial Framework 11 KPMG

More information

Solvency II. November 2014. Sponsored by:

Solvency II. November 2014. Sponsored by: The Data Management Implications of Solvency II November 2014 Sponsored by: Legal Entity Identifiers Managing Editor Sarah Underwood sarah.underwood@a-teamgroup.com A-Team Group Chief Executive Officer

More information

Rating Methodology for Domestic Life Insurance Companies

Rating Methodology for Domestic Life Insurance Companies Rating Methodology for Domestic Life Insurance Companies Introduction ICRA Lanka s Claim Paying Ability Ratings (CPRs) are opinions on the ability of life insurance companies to pay claims and policyholder

More information

Solvency II. PwC. *connected thinking. Solvency II GAP-analysis: practical experience (life and non-life business)

Solvency II. PwC. *connected thinking. Solvency II GAP-analysis: practical experience (life and non-life business) Solvency II Solvency II GAP-analysis: practical experience (life and non-life business) *connected thinking PwC Decide ambition level for Solvency II Business use Standard model, Total eller partiel Optimizing

More information

Interest Rate Risk in the Banking Book

Interest Rate Risk in the Banking Book Sidney Leever, Frank Pardoel, Pim Poppe. March 2016 Interest Rate Risk in the Banking Book White paper: Interest Rate Risk in the Banking Book March 2016 Interest Rate Risk in the Banking Book In 2015,

More information

The standard formula requires further adjustments

The standard formula requires further adjustments EIOPA publishes the results of the fifth quantitative impact study (QIS5) The standard formula requires further adjustments Authors Martin Brosemer Dr. Kathleen Ehrlich Dr. Norbert Kuschel Lars Moormann

More information

Solvency II Breakfast Briefing. Mark Burke, 28 October 2015 Head of Advisory, Analytics & Actuarial Services

Solvency II Breakfast Briefing. Mark Burke, 28 October 2015 Head of Advisory, Analytics & Actuarial Services Solvency II Breakfast Briefing Mark Burke, 28 October 2015 Head of Advisory, Analytics & Actuarial Services Agenda Developments within Insurance Directorate Implications of Solvency II on supervisory engagement

More information

Reinsurance in the economic balance sheet

Reinsurance in the economic balance sheet Solvency Consulting Knowledge Series Authors Dr. Manijeh Mc Hugh Lars Moormann Contact solvency-solutions@munichre.com January 2014 Background Over the last few years, we have seen supervisory systems

More information