Directive 2009/138/EC (Solvency II Directive) has been transposed into UK law. The EU risk-based solvency regime for insurers and reinsurers comes into force on 1 January 2016. The 1 April transposition provides Member State national regulators with the authority to make various assessments prior to the regime coming into force – for example, approving the use of internal models. Solvency II replaces a number of existing Directives, collectively known as ‘Solvency I’.
The Solvency 2 Regulations 2015 (SI 2015/575) were published by the UK Government on 9 March. These regulations implement in part the Solvency II Directive into UK law by amending various primary and secondary legislation (including the Financial Services and Markets Act 2000). The remainder of the Solvency II Directive will be implemented through changes to the PRA Rulebook (contained in the Solvency II Firms part of the PRA Rulebook and FCA Handbook. The European Commission Delegated Regulation (EU) 2015/35 is directly applicable and therefore does not need to be implemented into UK law.
For further information about Solvency II please view:
Ten things you need to know about Solvency II
We will be providing regular updates on aspects of Solvency II as implementation draws closer.