EIOPA’s proposal for regular reviews of parameters ensuring climate change is appropriately captured in SII welcomed

Written by Adam Cadle

01/03/2021

EIOPA’s proposal for regular reviews of parameters to ensure climate change is appropriately captured in Solvency II have been welcomed by European insurers.

In its response to EIOPA’s consultation on the topic, Insurance Europe said proposals to reassess the parameters, for example every three to five years, “is the most appropriate approach”.

“This will also capture any exposure, vulnerability and model changes, which are also important considerations during any recalibration,” it added.

Insurance Europe pointed out that if the reassessment demonstrates a need for a recalibration of a particular parameter or set of parameters, this should be done via a standardised, transparent process that is comprehensible and clearly documented.

“Materiality will be an important aspect of the reassessment exercise and EIOPA should therefore clearly define materiality in this context and apply it consistently,” it concluded.

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