PRA launches QIS for SII review

Written by Adam Cadle

20/07/2021

The PRA has launched its Quantitative Impact Study (QIS) for the Solvency II review.

The QIS focuses on three key structural components of the balance sheet that the regulator believes need serious consideration in the review: the risk margin, the MA, and the transitional measure on technical provisions.

“We are gathering data in these areas to help us model potential policy options, and to understand how the drivers of the transitional measure on technical provisions may change as a consequence of changes to other parts of the balance sheet,” the PRA stated.

“Early next month, we will also release a series of qualitative questions to inform our thinking about Solvency II reform. Example areas covered include the eligibility criteria for assets in the MA portfolio, regulatory processes around internal model and MA approvals, and the costs of implementing reforms. The qualitative questions will also explore how potential changes to the balance sheet may affect a firm's risk appetite, business plans, reinsurance, and investments.”

The PRA said early next month, it will also release a series of qualitative questions to inform its thinking about Solvency II reform. Example areas covered include the eligibility criteria for assets in the MA portfolio, regulatory processes around internal model and MA approvals, and the costs of implementing reforms. The qualitative questions will also explore how potential changes to the balance sheet may affect a firm’s risk appetite, business plans, reinsurance, and investments.

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