KPMG updates
Consumer Protection Code 2025
In this article, the KPMG Risk consulting team (led by Gillian Kelly, Partner, Consulting) discusses the publication of the Consumer Protection Code (CPC) 2025 by the Central Bank of Ireland (the Central Bank) which will come into effect on 24 March 2026. In addition, the Risk Consulting team outlines the key changes in the final regulations and guidance documents compared to the draft versions which were published by the Central Bank in March 2024.
CSRD’s first reporters are paving the way
The KPMG Sustainable Futures team (led by Russell Smyth, Partner, Sustainable Futures) and Lorraine McCann (Managing Director, Sustainable Futures) reviews in this article the Corporate Sustainability Reporting Directive (‘CSRD’) reporting by 50 companies that issued in January and February 2024. The early findings from the reporting shows trends relevant for all companies that will be reporting on sustainability performance.
Board Leadership Centre – Tariffs, trade and testing resilience
The KPMG Board Leadership Centre led by Ryan McCarthy, KPMG Ireland Audit Partner and Board Leadership Centre Lead hosted its latest event in Dublin. The event featured award-winning LBC radio broadcaster and author James O’Brien and economist and podcaster Chris Johns. The focus of the event was the UK-Ireland relationship, but events across the Atlantic with regard to Donald Trump's planned tariffs and the implications for boards, naturally dominated the discussion.
Upcoming financial reporting changes for (re)insurers
Niall Naughton, KPMG, Financial Services Partner) discusses the key forthcoming changes to the UK/Irish Generally Accepted Accounting Principles (‘UK/Irish GAAP’) and International Financial Reporting Standards (‘IFRS’) that will impact entities. By being clear on what changes need to be implemented entities can ensure that compliance with the new requirements is achieved on time and financial reporting integrity is maintained.
Central Bank Updates
Central Bank: Insurance Newsletter
The Central Bank published its quarterly Insurance Newsletter in March. Among other items, the Central Bank refers to the publication of the 2025 Regulatory and Supervisory Outlook Report, the 2025 supervisory priorities, the publication of the revised Consumer Protection Code, the planned data request on Asset Intensive Reinsurance to a sample of less than 20 life (re)insurance firms in Q2 2025, and the new return to facilitate the collection of the Section 27B&C Auditors Statutory Duty Confirmation.
Central Bank: Demographics of the Financial Sector Report
The Central Bank published its Demographics of the Financial Sector Report in March. The report provides an analysis of diversity levels among individuals seeking approval and those approved to act in senior management and board-level roles within regulated firms as of 31 December 2024. The report highlights trends in gender, age, and nationality, emphasising the importance of diversity and inclusion in firms.
Central Bank: Consultation Paper on Fitness & Probity (F&P)
The Central Bank has published a Consultation Paper (CP160) to revise its Fitness and Probity (F&P) Regime, following the 2024 independent review of the F&P assessment process. The consultation aims to enhance clarity and transparency in supervisory expectations and includes a review of the list of prescribed Pre-Approval Controlled Functions (PCFs). The establishment of a dedicated F&P Unit, the creation of a Gatekeeping Decisions Committee to oversee potential refusals, and the publication of a Gatekeeper Process Manual to guide firms through the application process. Stakeholders are invited to submit feedback on CP160 by 10 July 2025.
Central Bank: F&P Implementation Report
The Central Bank has published a report on the progress of the implementation of recommendations from the Fitness & Probity Review conducted in 2024. This Implementation Report details the extensive efforts taken since the review to enhance and uphold the processes, emphasising fairness, transparency, and efficiency. All recommendations from the 2024 review have been accepted, with ongoing work planned to continue strengthening the processes through 2025.
European Insurance and Occupational Pensions Authority Updates
Solvency II: Consultation on revised Guidelines on the treatment of related undertakings
EIOPA has launched a consultation on draft revised guidelines on the treatment of related undertakings under the Solvency II framework. The revisions aim to clarify and streamline the existing guidelines, which have been in place since 2015, without altering supervisory expectations or introducing new guidance. The updates focus on improving clarity and aligning with changes in the legal framework, ensuring that the guidelines remain effective and relevant. The consultation is open for feedback until 26 June 2025.
Solvency II: Capital Requirements for cryptoasset investments
EIOPA has published its technical advice to the European Commission (EC) on standard formula capital requirements for investments in cryptoassets. EIOPA consulted on a draft of its technical advice in October 2024. EIOPA notes that cryptoassets are a relatively new asset class in finance and their regulatory treatment is still evolving. The technical advice responds to a request from the EC in May 2024, relating to its review of specific items in the Solvency II Delegated Regulation.
Solvency II Directive: Level 3 Materials
EIOPA has published a series of consultation papers on proposed amendments to guidelines and an opinion under the Solvency II Directive, as amended by the Solvency II Amending Directive. The series consists of the following:
- A consultation paper on draft guidelines on the exclusion of undertakings from the scope of group supervision.
- A consultation paper on draft revised guidelines on the treatment of related undertakings, including participations.
- A consultation paper on a draft revised opinion on the supervisory assessment of internal models including a dynamic volatility adjustment (dynamic VA or DVA).
Comments can be made on the proposals until 26 June 2025. EIOPA will revise its proposals in the light of comments received and will publish a report on each consultation, including the revised proposal. The new and revised guidelines shall apply from 30 January 2027.
Regulation and Supervision Approach
EIOPA has published a note setting out its approach for better regulation and supervision to promote regulatory simplification and burden reduction, including in relation to regulatory reporting. EIOPA states that simplification offers an opportunity to foster growth and better serve consumers, society and the EU economy by focusing on outcomes.
Implementation of the Insurance Recovery and Resolution Directive
EIOPA have released consultation papers for the implementation of the Insurance Recovery and Resolution Directive (IRRD). The series consists of the following:
- A consultation paper proposing draft regulatory technical standards (RTS) on the content of (group) pre-emptive recovery plans.
- A consultation paper on the proposal for RTS on criteria for pre-emptive recovery planning requirements and methods to be used when determining the market shares.
- A consultation paper on the proposal for Guidelines on criteria for the identification of critical functions.
- A consultation paper on the proposal for RTS on the content of resolution plans and group resolution plans.
- A consultation paper on the proposal for Guidelines to specify further the matters and criteria for the assessment of the resolvability of undertakings or groups.
- A consultation paper on the proposal for Guidelines on further details on the measures to remove impediments to resolvability and the circumstances in which each measure may be applied.
Feedback on these proposals is invited until July 31, 2025.
UK Updates
FCA: Delivering good outcomes for customers in vulnerable circumstances – good practice and areas for improvement
On 07 March, the FCA published a report outlining examples of good practice and areas for improvement to help firms support customers in vulnerable circumstances.
FCA: Consumer Support Outcome: good practices and areas for improvement
On 07 March, the FCA published the findings of their review of firms’ approaches to the consumer support outcome of the Consumer Duty
Prudential Regulation Authority (PRA)
PRA: Speeches
In February, the PRA published the following speeches:
- Innovating wholesale payments: building a resilient and innovative future − speech by Victoria Cleland
- Growth: What does it take in today’s world? - Lecture by Andrew Bailey
- Holding the anchor in turbulent waters – speech by Catherine L. Mann
- Accountants can influence growth, competitiveness and innovation in the UK to boost the economy − speech by Afua Kyei
PRA: Regulatory Digest
On 03 March, the PRA published their regulatory digest for February 2025.
PRA: Financial Services Compensation Scheme
On 31 March, the PRA proposed to raise the deposit protection limit of the Financial Services Compensation Scheme (FSCS) from £85,000 to £110,000.
Other European and International Supervisory Authority Updates
ESAs: Joint Annual Report for 2024
The joint committee of the European Supervisory Authorities (EBA, EIOPA, ESMA – ESAs) published its 2024 Annual Report in April. The report provides an overview of the joint work completed by the ESAs during 2024. The main areas of focus in 2024 were joint risk assessments, sustainable finance, operational risk and digital resilience, consumer protection, financial innovation, securitisation, financial conglomerates and the European Single Access Point (ESAP).
IAIS: March Newsletter
The International Association of Insurance Supervisors (IAIS) published its newsletter for March 2025. The newsletter covers various topics of interest and work currently being undertaken by the IAIS.
IAIS: Application Paper on the supervision of climate-related risks in the insurance sector
The IAIS published an application paper to assist insurance supervisors in integrating climate-related risks into their supervisory frameworks. This paper, which updates the 2021 version, offers practical guidance on applying the IAIS's Insurance Core Principles (ICPs) to address climate risks. Key areas covered include corporate governance, risk management, valuation, investment practices, supervisory reporting, public disclosure, macroprudential supervision, group supervision, and scenario analysis. A public webinar to discuss the paper is scheduled for 28 April 2025.
EIOPA Q&A
EIOPA Q&A Updates
Please see below for EIOPA’s response to recent queries which have been raised by the public for further clarification on the Solvency II requirements. The Solvency II requirements may change or become more prescriptive over time.
07 March: S.06.02
EIOPA clarified in Q&A (#2719) that with regards to contract that cover risks in several member states, the European Commission declared that: “In the event that a single insurance contract covers risks/commitments belonging to a policy-holder's subsidiaries or branches, the location of the various risks/commitments covered by this contract must be determined on an individual basis for each risk/commitment”
07 March: Articles 76, 77 and 77e of SII Directive; 37, 38 of DR
EIOPA clarified in Q&A (#2899) that when calculating technical provisions insurance undertakings shall use that technical information which was adopted by the Commission in accordance with Article 77e (2).
07 March: Articles 13(14) and 147
EIOPA clarified in Q&A (#2939) that in the case of a policyholder moving residence to another member state after the insurance contract has concluded, Solvency II does not define the date on which the habitual residence of the policyholder must be determined.
13 March: Article 55
EIOPA clarified in Q&A (#3180) that non-life inwards reinsurance should be classified under LoBs 13-24. Outward reinsurance should not lead to Technical Provisions and instead should be recognised as reinsurance recoverables.
13 March: S.06.02, S.11.01
EIOPA clarified in Q&A (#3235) that NACE ‘Other’ should not be assigned for QRT S.06.02, S.11.01 and S.37.01.
13 March: S.06.03
EIOPA clarified in Q&A (#3224) that in the instructions of S.06.03 the reference to CIC 8 and 9 should also include CIC 7.
13 March: S.04.04, S.04.05:
EIOPA provided in Q&A (#3164) two examples to clarify the expected reporting in S.04.04 and S.04.05:
13 March: Reinsurance
EIOPA clarified in Q&A (#3162) that outwards reinsurance should be classified according to the nature of the risk transferred from the underlying contracts being reinsured. Therefore, an outward reinsurance policy providing coverage for an inward life reinsurance policy should be considered as a life reinsurance policy.
13 March: S.06.02
EIOPA clarified in Q&A (#3196) that the external rating scale used for short-term deposits in local currency should reflect the long-term rating of the counterpart.
13 March: Article 227
EIOPA clarified in Q&A (#3071) that the provisional equivalence of the Japanese supervisory system will expire on 31 December 2025 unless the European Commission will consider to take a decision on the renewal of provisional equivalence under Article 227 of Solvency II before end 2025.
21 March: Articles 3(22) - DORA
EIOPA clarified in Q&A (#2959) that DORA does not define ‘function’ to enable flexibility for the financial entities (FEs) to identify their functions in accordance with their operational and organisational framework.
21 March: Articles 6(1) - DORA
EIOPA clarified in Q&A (#2990) that if a parent undertaking is not a financial entity, the obligation to keep registers of information does not apply to the parent undertaking at individual level.
21 March: DORA
EIOPA clarified in Q&A (#3076) the following with regard the meaning of ‘linked’ in field B_06.01.0020 of DORA: “Each function reported in B_06.01.0010 shall be ‘linked’ to a ‘licenced activity’ listed in annex II. In case the function could not be linked to a licenced activity ‘support function’ shall be reported in B_06.01.0020 instead of the ‘licenced activity’.”
21 March: Articles 2(1)
EIOPA clarified in Q&A (#3168) the extent to which insurance comparison websites fall under ‘insurance distribution’ (IDD).
24 March: S.14.02 & S.17.03
EIOPA clarified in Q&A (#2670) the following with regard to the template:
- For scenarios where the Line of Business consists entirely of one Product category, only the row of the specific product category should be reported in S.14.02.
- If the Home Country represents a small part (i.e. less than 10%) of the written premiums for a given LoB, the premium should be reported together with other non-material countries.
- If product category encompasses an entire Line of Business, only one row should be reported for this LoB.
Further information
For more on any of the items above, or any Insurance-related queries, contact Brian Morrissey, Head of Insurance. We'd be delighted to hear from you.
