The European Insurance and Occupational Pensions Authority (EIOPA) published today the final Guidelines for the preparation of Solvency II.
The Guidelines were finalized following the public consultation earlier this year, during which EIOPA received over 4000 comments.
With its Guidelines EIOPA intends to significantly increase preparedness of both supervisors and insurers for Solvency II once the new framework is applicable. The Guidelines aim to ensure that National Competent Authorities (NCAs), insurance companies and groups take active steps towards implementing certain key elements of Solvency II in a consistent and convergent way. It is up to NCAs to decide how best to incorporate the Guidelines into their national regulatory or supervisory framework. The Guidelines foresee a gradual application through “phasing-in” provisions (i.e. different expectations for 2014 and 2015).
EIOPA Guidelines cover a number of key areas of Solvency II: system of governance, including risk management; forward looking assessment of the undertaking’s own risk (based on the Own Risk and Solvency Assessment (ORSA) principles); submission of information to NCAs; pre-application for internal models.
EIOPA envisages issuing the Guidelines in all the official EU languages on 31 October 2013 with the application date of 1 January 2014. The NCAs will report to EIOPA about their compliance or intention to comply within 2 months after the Guidelines’ issuance. The NCAs are required to submit a progress report to EIOPA on the Guidelines’ implementation in February 2015.
Gabriel Bernardino, Chairman of EIOPA, said: “I would like to thank all the stakeholders for their valuable input during the public consultation.
Their comments and suggestions helped us to refine the content and achieve a better balanced approach to the preparatory phase. Together we have made a decisive step towards Solvency II!
The move towards a risk-based supervisory system like Solvency II presents a number of important challenges to undertakings and supervisors. These Guidelines are a key step in order to ensure that preparation will be done in a consistent manner for the benefit of the internal market, industry and consumers”.
