PRA publishes updated Solvency II technical information
The PRA published updated Solvency II technical information today and its statement of policy, PS1/20, which sets out the proposed approach to publication.
The PRA said UK insurance firms must use the technical information it publishes to calculate the Solvency II technical provisions from 11pm on 31 December 2020.
### Key changes include:
• Currency coverage: The PRA must publish the technical information needed to value insurance liabilities for each relevant currency.
• CRA methodology: At the end of the transition period, the PRA adopted EIOPA’s methodology for determining the CRA for each PRA-relevant currency.
• CRA hierarchy: The PRA determines the CRA for each PRA-relevant currency using a hierarchy of methods, depending on the data available for each currency (see EIOPA technical documentation).
• GBP indicative packages: The PRA published indicative GBP technical information packages, based on SONIA OIS, with reference dates of 31 May 2021 and 30 June to assist firms analysing differences from the PRA’s transition to SONIA-based TI.
• EU parallel publication: The European Insurance and Occupational Pensions Authority publishes equivalent technical information for EU insurance firms, including EU subsidiaries of UK insurance groups.
### Legislative changes
The statutory provision underpinning the PRA’s production of Solvency II technical information is Regulation 4B of the Solvency II Regulations 2015; that provision was later set to be revoked and restated from 30 June 2024. Regulation 4B is being replaced by Regulation 3 of The Insurance and Reinsurance Undertakings (Prudential Requirements) Regulations 2023.
