Answers to the European Commission on the ... - Eiopa - Europa

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income E) Prohibition of certain investments F) Prohibition of free disposal of assets G) Cus<strong>to</strong>dy of assets by <strong>the</strong> authority H) Reducing benefits of existing contracts I) Suspension of claims payments J) Manda<strong>to</strong>ry portfolio transfer 2 K) Measures relating <strong>to</strong> reinsurance ceded L) Removal of members of <strong>the</strong> Board of Direc<strong>to</strong>rs 1 M) Removal of o<strong>the</strong>r managers N) Appointment of a special 1 1 commissioner 1 O) Actuarial investigation Audi<strong>to</strong>r report / investigation P) General meeting of shareholders called Q) Temporary suspension of 2 1 authorisation 1 R) Withdrawal of authorisation 1 S) File for bankruptcy or winding-up T) Initiate or recommend starting criminal proceedings, (including money-laundering) 1 U) Request <strong>to</strong> increase technical provisions 2 V) O<strong>the</strong>r Current situation 1 1 Takeover by ano<strong>the</strong>r company 2 2 Continuation of business as a (reduced) independent entity 18 10 2 Withdrawal of authorisation by <strong>the</strong> supervisory authority. 10 1 Table 2: Risk group: actual failures 262
Solvency ratio prior <strong>to</strong> <strong>the</strong> failure Reported solvency ratio up <strong>to</strong> 1 year before <strong>the</strong> actual failure < 100% 100%- 125%- 150%- > 200% All 125% 150% 200% 11 12 12 2 9 46 24% 26% 26% 4% 20% 100% Table 3: Solvency ratio up <strong>to</strong> 1 year prior <strong>to</strong> failure Reported solvency ratio up <strong>to</strong> 2 years before <strong>the</strong> actual failure < 100% 100%- 125%- 150%- > 200% All 125% 150% 200% 6 8 4 2 10 30 20% 27% 13% 7% 33% 100% Table 4: Solvency ratio up <strong>to</strong> 2 years before failure 263
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CEIOPS-DOC-07/05 Answers</s
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Style convention The following has
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• Safety measures (CfA 9); • So
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sole purpose is to
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Call for Advice No. 7 Technical pro
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one year). Therefore, capital requi
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perhaps through an explicit additio
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Discounting 7.22 The present value
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exposed to risk fr
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insurance liabilities set by refere
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Profit sharing In practice, for uni
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future cash flows will have <strong
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Explanatory text S
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always have resources to</s
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developed. They would help
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8.28 A fourth option could be envis
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In principle, "the
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8.48 Three alternatives can be cons
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essential part of the</stro
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statistical estimate (with a level
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8.77 It may be argued that
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to use more sophis
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consequence on the
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8.105 In some cases, the</s
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This shall be reviewed, at least an
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ut the exposure <s
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Explanatory text M
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9.15 Solvency II could also employ
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9.28 The life formula yields itself
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underestimate them
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'Prudent person plus' approach 9.52
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Uniform or different rules for tech
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through a prescribed list. Lists ar
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addition a range of stresses so tha
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(including the Rei
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for review of the
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eligibility criteria, or principles
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should not lead to
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• the degree of
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9.156 The senior management shall r
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- going-concern aspects of business
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features. 81 TailVaR is an example
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10.17 The SCR should also reflect <
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10.26 The risk of asset liability m
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Naturally, the pra
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too few categories
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- Choice of volume measures 10.57 W
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Underwriting risk in non-life insur
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volatility of thei
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those insurers this possible increa
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10.103 A factor-ba
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10.112 Assessing whethe</st
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10.121 The SCR should deliver a lev
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whenever its effects on the
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scenario techniques to</str
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Operational risk just ratings infor
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Call for Advice No. 11 Solvency cap
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Costs and Benefits 11.6 It should b
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• Qualitative requirements for <s
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11.19 Risk management criteria set
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individual undertaking is exposed a
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• sensitivity analyses that have
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• visualizations of flows of prod
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Partial models and the</str
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11.58 There should be few descripti
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of the SCR estimat
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equirements to imp
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Call for Advice No. 12 Reinsurance
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Reflection in technical provisions
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• provide an estimate of an under
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particular reinsurer(s)’ aggregat
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they auto<
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einsurer to <stron
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should be a reduction in risk regar
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Call for Advice No. 13 Quantitative
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• the process of
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• handling questions from insuran
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member countries and in the
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components of the
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Background 14.1 Current insurance D
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14.12 In order to
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groups in its answer to</st
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affected; • Impose restrictions o
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14.43 Regarding the</strong
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off all contracts; • to</
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Call for Advice No. 15 Solvency con
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Minimum capital requirement (MCR) D
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adjusted SCR. From a purely technic
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to be implemented.
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capital
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absolute floor (expressed in euros
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Bolkestein agreed to</stron
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16.14 Generally speaking, complianc
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appoint an additional person <stron
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16.28 It should also be noted that
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Time of application 16.41 The asses
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of the individual
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Background 17.1 This document aims
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Review Panel would be a permanent g
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• the developmen
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asis for considering improvements <
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(I) Regulatory arb
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(II) Capital requirements at group
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into a SCR at grou
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18.31 Additionally, it must be deci
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Page 215 and 216: 18.60 In view of the</stron
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Page 229 and 230: Specific principles for non-life in
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Page 235 and 236: A.64 In the tests
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Page 239 and 240: TVaR1-α for Tail Value-at-risk. In
Page 241 and 242: Degree of personalisation B.24 Tran
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Page 245 and 246: Segmentation B.44 In general terms,
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Page 255 and 256: B.95 In a scenario-based approach,
Page 257 and 258: B.106 As an alternative one could t
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Page 265 and 266: Number of instances Risk group Deta
Page 267 and 268: Conclusion In general, the<
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Page 279: programmes on the
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