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EIOPA consults on technical advice for the 2020 review of Solvency II

On 15 October 2019, the European Insurance and Occupational Pensions Authority (EIOPA) published a draft opinion on technical advice for the 2020 review of the Solvency II Directive (2009/138/EC). Responses to the draft technical advice are invited by 15 January 2020 to enable EIOPA to publish a final opinion by June 2020. The European Commission … Continue Reading

FCA publishes interim report on general insurance pricing practices as part of its market study

The Financial Conduct Authority (FCA) has published an interim report on its market study into General insurance pricing practices (MS18/1.2). A market study was launched in October 2018 by the FCA to understand whether pricing practices in home and motor insurance support effective competition and lead to good consumer outcomes. The market study followed a … Continue Reading

PRA publishes PS21/19 responses to CP13/19 ‘Occasional Consultation Paper’ with updated Supervisory Statements

The Prudential Regulation Authority (PRA) has published a Policy Statement (PS) to provide feedback to responses to Consultation Paper (CP) 13/19 ‘Occasional Consultation Paper’. In PS21/19 the PRA sets out its final rules and guidance on issues consulted on in the following chapters of CP13/19: Chapter 2: Solvency II: the quality of capital instruments. Chapter … Continue Reading

EIOPA publishes opinion on sustainability within Solvency II

On 30 September 2019, the European Insurance and Occupational Pensions Authority (EIOPA) published an Opinion on sustainability within Solvency II. The Opinion follows a request made in August 2018 by the European Commission for an opinion on sustainability with an emphasis upon climate change mitigation. The European Commission will take the Opinion into account in … Continue Reading

Part VII judgment puts life-transfers in the spotlight

The usually predictable world of portfolio transfers received a jolt on 16 August when Mr Justice Snowden declined to exercise his discretion to sanction the proposed insurance business transfer of a £12.9 billion book of in-payment annuities from The Prudential Assurance Company Limited (“Prudential”) to Rothesay Life Limited (“Rothesay”).  This is believed to be the … Continue Reading

FCA publishes CP19/23: Signposting to travel insurance for consumers with medical conditions

On 15 July 2019, the Financial Conduct Authority (FCA) published Signposting to travel insurance for consumers with medical conditions (CP19/23). CP19/23 continues the work undertaken by the FCA over the past few years on ensuring that vulnerable customers can access insurance. In June 2017 the FCA published a Call for Input on access to insurance … Continue Reading

Working Group on Sterling Risk-Free Reference Rates urges EIOPA to remove the recognised Solvency II barriers to IBOR transition

On 12 July 2019, the Working Group on Sterling Risk-Free Reference Rates published a letter from Tushar Morzaria, chair of the working group, to Gabriel Bernardino, EIOPA chair, encouraging EIOPA to go beyond monitoring the IBOR transition to now actively removing the recognised Solvency II barriers to this transition. The letter expressed concerns surrounding the … Continue Reading

Amendments to Solvency II Delegated Regulation published in the Official Journal

On 18th June 2019, Commission Delegated Regulation (EU) 2019/981 (the Amending Regulation), which amends the Solvency II Delegated Regulation ((EU) 2015/35), was published in the Official Journal of the EU. The European Commission adopted the Amending Regulation on 8 March 2019. The Amending Regulation will enter into force on 8 July 2019 (twenty days after … Continue Reading

Government proposes to address ‘loyalty penalty’ with CMA fines for breaches of consumer laws

Secretary of State for Business, Energy and Industrial Strategy, Greg Clark MP, has written a letter to the chief executive of the Competition and Markets Authority (CMA), Dr. Andrea Coscelli, about government proposals to take action to prevent harm to customers arising from the ‘loyalty penalty’. In the letter Greg Clark commits to ensuring that … Continue Reading

PRA publishes framework for assessing the financial impacts of physical climate change for the general insurance sector

On 22 May 2019, the Prudential Regulation Authority (PRA) published a report outlining a framework for practitioners to use to assess the financial impact to the liability side of the firm’s balance sheet caused by future climate change. The framework was developed by a cross-industry working group and is aimed at practitioners working with, or … Continue Reading

Speech by David Rule, Executive Director of Insurance Supervision, PRA, on ‘Model use and misuse’

David Rule, Executive Director of Insurance Supervision at the Prudential Regulation Authority (PRA), has delivered a speech on ‘Model use and misuse’ at the Association of British Insurers Prudential Seminar. The speech highlights PRA concerns about some uses of models. Models are used widely in insurance to mimic various scenarios so that insurers can estimate … Continue Reading

PRA updates Solvency II remuneration policy statement for category 1 and 2 firms

All UK Solvency II firms must comply with Article 275 of the Solvency II Delegated Regulation (EU) 2015/35 in respect of their remuneration policies. The Prudential Regulation Authority (PRA) asks UK Solvency II firms to complete a Remuneration Policy Statement to document remuneration policies and procedures. On 8 May 2019 the PRA published an updated … Continue Reading

EIOPA publishes a report following its thematic review of the use of Big Data Analytics in motor and health insurance

The European Insurance and Occupational Pensions Authority (EIOPA) has published a report on the use of Big Data Analytics in motor and health insurance. The report reveals a trend for increasingly data-driven business models throughout the insurance value chain in both health and motor insurance.… Continue Reading

General insurance firms are failing to ensure that their products and services provide value to customers says FCA

On 10 April 2010, the Financial Conduct Authority (FCA) published a press release in respect of work undertaken to ensure that customers of general insurance (GI) products are getting value for money. The FCA will continue to undertake diagnostic work on product value in GI distribution chains and will expect firms to meet its expectations … Continue Reading

France clarifies the form and content of the information to be provided by UK insurers to their French insureds and policyholders following Brexit in the event of a no-deal

On 22 March 2019, the French Ministry of Economy and Finance passed a decree (the Decree) implementing the provisions of the ordinance n° 2019-75 of 6 February 2019, introducing a contingency plan for the financial institutions sector in connection with the withdrawal of the United Kingdom (UK) from the European Union (EU) (the Ordinance). As … Continue Reading

European Commission adopts amendments to the Solvency II delegated regulation to help insurers invest in equity and private debt and to provide long-term capital financing

The European Commission has adopted amendments (in the form of a regulation) to Delegated Regulation (EU) 2015/35 (the Solvency II Delegated Regulation) which implements various technical requirements of the Solvency II Directive (2009/138/EC).  The amending regulation has been introduced as part of the proposals for the Capital Markets Union (CMU).… Continue Reading

Bank of England and Financial Conduct Authority agree Memoranda of Understanding with EIOPA and EU insurance supervisors

On 5 March 2019, the Bank of England (in the form of the Prudential Regulation Authority (PRA)), the Financial Conduct Authority (FCA) and the European Insurance and Occupational Pensions Authority (EIOPA) announced that they had agreed Memoranda of Understanding (MoUs) in respect of supervisory co-operation and information-sharing arrangements for UK and EU/EEA insurance firms.… Continue Reading

German government makes preparations to pave the way for a transitional regime for the run-off of the German business of UK insurers and reinsurers in the case of a hard Brexit

Update of 25 February 2019: The German draft act laying the ground for a limited transitional regime for UK financial services firms including insurers and reinsurers following a hard Brexit has passed the German parliament (Bundestag) on 21 February 2019 without any amendments regarding the transitional regime for UK insurers and reinsurers. The required approval … Continue Reading

EIOPA publishes framework for assessing conduct risk through the product lifecycle

On 20 February 2019, the European Insurance and Occupational Pensions Authority (EIOPA) published a framework to identify the drivers of conduct risk so that EIOPA and European National Competent Authorities (NCAs) can focus on minimising these risks to consumers.… Continue Reading

EIOPA issues recommendations to European National Competent Authorities to minimise risks to policyholders in the event of a no-deal Brexit

On 19 February 2019, the European Insurance and Occupational Pensions Authority (EIOPA) issued nine recommendations to the National Competent Authorities (NCAs) with responsibility for the supervision of insurance undertakings and insurance intermediaries in European Union (EU) Member States. The recommendations provide the NCAs with guidance on EIOPA’s expectations in relation to the treatment of UK … Continue Reading