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Recalculation of the Solvency II transitional measures on technical provisions

Tuesday 28 November 2017 17:00 - 19:00

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This working party has examined the management of Transitional Measures for TPs, a measure, one approved by PRA under Solvency II but whose subsequent management is not laid down in all areas. Download the paper here.

Solvency II came into force on 1 January 2016 and included a transitional measure on technical provisions ("TMTP") designed to help smooth in the capital impact of Solvency II over a 16 year period. The working party’s view is that the main intention of the TMTP is to mitigate the impact of the introduction of the risk margin, which significantly increases the technical provisions of firms, relative to their Solvency I Pillar 2 liabilities.

The majority of firms who hold a TMTP have now had at least one recalculation approved by the PRA; or are in the process of applying for a recalculation. Despite this large number of approved recalculations, there remains significant uncertainty in the industry around the approach and triggers for recalculation.

This paper considers aspects of TMTP recalculation for regulated UK life firms, for example practicalities of the calculation, asset and liability considerations, and communications/announcements.

In this paper we outline the need for pragmatism when considering the approach to recalculation of a measure originally intended to serve as the bridge between two regimes. We call for an allowance for doing what is sensible in a principles based regime balancing what might be more theoretically correct with what is practical and possible to support effective management of the business.

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17.00 – 17.30      Registration and coffee/tea

17.30 – 17.35      Scottish Board

17.35 – 17.40      Chair’s opening remarks (Craig Murison, Lloyds Banking Group)

17.40 – 18.10      Working party presentation (Susan Morgan, Prudential and Andy Rogan, Lloyds Banking Group)

18.10 – 18.50      Q&A panel session with Chair and working party (Craig Murison, Lloyds Banking Group, Susan Morgan, Prudential and Andy Rogan, Lloyds Banking Group)

18.50 – 19.00      Closer and Chair’s closing remarks (Craig Murison, Lloyds Banking Group

Location

Address

Royal College of Physicians of Edinburgh, 9 Queen St, Edinburgh EH2 1JQ 

Nearest Public Transport

Edinburgh Waverley Train Station

Pricing information

Price:
Free

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