Financial Services Regulation and Compliance - Insurance May 2020
DOMESTIC
CBI finds merit to extending the scope of National Claims Information Database to employers' and public liability insurance
On 1 May 2020, the Central Bank of Ireland (CBI) published a study which concluded that there is merit to including data relating to Employers’ and Public Liability insurance in the scope of the National Claims Information Database. The CBI notes that there is a deficiency in the availability of data on employers' liability and public liability insurance. The CBI expects to begin collecting data later in 2020 and publish its first report in the first half of 2021.
CBI updates COVID-19 hub with guidance on temporary PCF approvals during the COVID-19 outbreak
The CBI COVID-19 Hub has been updated to include guidance in relation to PCF approvals during the COVID-19 outbreak. If a PCF holder is unable to perform their role due to illness or if a firm cannot fill a permanent PCF role vacancy due to COVID-19, the firm can seek to have another suitable individual perform that role for a limited period (prior approval from the CBI is required).
The CBI guidance requires firms to take the following steps:
- refer to internal succession and contingency plans to identify a suitable individual for temporary appointment
- contact the CBI stating that they wish to make a temporary appointment
Interviews will still be a key part of the approval process and the CBI is exploring alternative methods such as videoconferencing and telephone interviews.
CBI announces updates to retail intermediary authorisation process
On 26 May 2020, the CBI announced that it will be implementing changes to professional indemnity insurance requirements for applicants seeking authorisation as a retail intermediary. This change is as a result of the entry into force of Commission Delegated Regulation (EU) 2019/1935. From 12 June 2020, an applicant seeking authorisation under the Investment Intermediaries Act or registration under the Insurance Distribution Regulations will be obliged to show that it holds professional indemnity insurance of €1,300,380 per claim and €1,924,560 in aggregate. The CBI noted that it will engage directly with applicants who have already submitted their application in light of the changed requirements.
EUROPEAN
EIOPA publishes monthly technical information
On 6 May 2020, EIOPA published technical information on the symmetric adjustment of the equity capital charge and risk free interest rate term structures for Solvency II purposes with reference to the end of April 2020 in both cases.
EIOPA publishes list of internationally active insurance groups headquartered in the EU
On 12 May 2020, EIOPA published the list of Internationally Active Insurance Groups (IAIGs) headquartered in the EU. IAIGs are the focus of the International Association of Insurance Supervisors Common Framework for the Supervision of Internationally Active Insurance Groups (ComFrame). ComFrame identifies an IAIG as being an insurance group that meets two criteria, related to its international activity and size. Additional lists of European IAIGs are expected to be published shortly.
EIOPA publishes May risk dashboard based on the Q4 2019 Solvency II data
On 18 May 2020, EIOPA published its updated Risk Dashboard for Q4 2019 summarising the main risks and vulnerabilities in the EU insurance sector.
Key observations include:
- risk exposures have increased due to COVID-19
- macro and market risks deteriorated in March 2020 with the macroeconomic environment being severely hampered by the global lockdown
- liquidity indicators were broadly stable for Q4-2019, this is expected to worsen due to decreases in premiums and increases in claims
- solvency positions for Q4-2019 remained relatively stable, however, profitability and solvency risks are expected to worsen
- market perceptions remain at medium level but are deteriorating
EIOPA changes the frequency of publication of extraordinary information from a weekly basis to every two weeks
Since 27 March 2020, EIOPA has published weekly technical information on the symmetric adjustment to equity risk and risk free interest rate term structures in order to assist (re)insurance undertakings in monitoring their solvency and financial position. From 25 May EIOPA will issue this information every two weeks. This information can be found in a designated extraordinary weekly updates section on the EIOPA website.
For more information on these topics please contact any member of A&L Goodbody's Insurance & Reinsurance team.
Date published: 8 June 2020