Solvency II - Lloyd's

(i) it is not probable that an outflow of resources embodying economic benefits will be required to
settle the obligation; or
(ii) the amount of the obligation cannot be measured with sufficient reliability.
These are neither related to insurance, nor financing nor lease; they are, for example, related to legal
expenses (with an expected probability of less than 50%).
2.3 QMC210: Off-balance sheet items
Purpose of form: This form presents an overall view of the off-balance sheet items, which could impact the
financial position of the syndicate, if realised.
This form is required for all reporting years combined and will be required on an annual basis.
The contingent liabilities included in this form is the amount that was not included in the contingent liabilities
amount in the balance sheet because of being immaterial. If possible, they should be valued at their
maximum possible value, regardless of their probability (i.e. future cash flows required to settle the
contingent liability over the lifetime of that contingent liability, discounted at the relevant risk-free rate term
structure).
Details relating to Funds at Lloyds’ (FAL) should not be reported on this form.
2.4 QMC220/QMC221: Own Funds (Annual/Quarterly)
Purpose of form: This form provides a detailed overview of the syndicate’s own funds.
These forms will be required for all reporting years combined and QMC220 will be required on an annual
basis, while QMC221 will be required on a quarterly basis.
Syndicate should report funds in syndicates (FIS) in this form but Funds at Lloyd’s (FAL) should be excluded.
Line 1 – Initial funds, members’ contributions (Funds in syndicate – FIS): This is the amount of capital
contributed by and held by syndicates. Only FIS should be reported on this line.
Line 2 – Surplus funds: This is the total of surplus funds that fall under Article 91 (2) of the Solvency II
Framework Directive (Directive 2009/138/EC). Surplus funds are accumulated profits which have not been
made available for distribution to policy holders and beneficiaries. This will not be applicable to syndicates.
Line 3 – Reconciliation reserve: The reconciliation reserve represents reserves (e.g. retained earnings), net
of adjustments (e.g. for ring fenced funds). It also reconciles differences between the accounting valuation
and Solvency II valuation. In the case of syndicates, the value on this line will equal members’ balances, less
foreseeable distributions and FIS (if applicable).
Line 7 – Foreseeable distributions: This is the amount of distribution that has been approved by the
managing agent’s Board but has not been made by the reporting date. In addition, any distributions that are
anticipated to be made in the following year on members’ balances as at the end of reporting year should
also be deducted from own funds being reported.
Line 10 & 11 – Expected profits included in future premium (EPIFP) – Life/non-life: These are the expected
profits included in future premiums and that are recognised in technical provisions.
2.5 QMC240/241: Non-life Technical Provisions (Annual/Quarterly)
Purpose of form: This form reports an overview of the non-life technical provisions by Solvency II line of
business and split into main components; best estimate (gross and net), reinsurance recoverable,
13