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.
21 February: QRT S.06.02
EIOPA clarified in Q&A (#2930) that the validation rule BV1213 has been amended to allow ‘No Custodian’ as per new guidance 2.8.0: "For assets where there is no custodian or when this item is not applicable, “No custodian” shall be reported."
13 February: FICOD (FC.06 & FC.07)
EIOPA clarified in Q&A (#3256) with regards to reporting the sum assured as a risk measure, that there is a general expectation to apply the look-through at the individual policyholder level on a best effort basis. If reporting at this level, beyond the contractual counterparty, is disproportionate, information can be reported at the contractual counterparty level based on the threshold set by the group supervisor. If the group believes this information does not represent the actual risk, it may provide additional information to the group supervisor.
13 February: FICOD (FC.06 & FC.07)
EIOPA clarified in Q&A (#3256) with regards to reporting the sum assured as a risk measure, that there is a general expectation to apply the look-through at the individual policyholder level on a best effort basis. If reporting at this level, beyond the contractual counterparty, is disproportionate, information can be reported at the contractual counterparty level based on the threshold set by the group supervisor. If the group believes this information does not represent the actual risk, it may provide additional information to the group supervisor.
13 February: FICOD (FC.01 - FC.05)
EIOPA provided in Q&A (#3255) a mapping for which detailed template each numerical amount of IGT significance in lines R.02.0 through R.02.5 in the template should be aligned to, unless otherwise specified by the coordinating authority.
13 February: FICOD
EIOPA clarified in Q&A (#3254) the following with regard to declaring balances on debit and credit accounts if they exceed the threshold: “Where contractual provisions allow for the netting of credit and debit balances between two or several entities of the financial conglomerate and that such credit and debit balances are considered on a net basis by the concerned undertaking under the applicable accounting framework, such credit and debit balances shall be considered as a single transaction for the purpose of intra-group transactions.”
13 February: FICOD
EIOPA clarified in Q&A (#3253) the conditions on whether the contractual net position of on derivatives can be declared if they exceed the threshold: “For derivatives, “transaction level” shall be therefore understood as all transactions under a given master netting arrangement. Several master netting agreements or netting sets could then be considered as forming a SEO and in that case, aggregation shall be done on a gross basis”. EIOPA also illustrated an example scenario.
13 February: FICOD
EIOPA clarified in Q&A (#3252) the following with regard to derivatives under FICOD: “derivative transactions shall be understood as all transactions under a given master netting arrangement. For derivatives, the maximum exposure over the reporting period covered is therefore the maximum absolute value of each netting set over the period.”
31 January: S.12.01 & S.13.01
EIOPA clarified in Q&A (#3128) the following:
- Future Guaranteed Benefits (FGB) in S.12.01 (and S.13.01) should include all future benefits that do not meet the definition of Future Discretionary Benefits (FDB) in article 1(35) of the Delegated Regulation 2015/35. Therefore, benefits from pure Index-linked and unit-linked (UL/IL) should be reported as FGB.
- FDB has the same meaning across all reporting templates, including S.12.01 and S.13.01, and it is the definition in Article 1(35) of the Delegated Regulation 2015/35.
- In S.12.01, “Future guaranteed and discretionary benefits" should include all future benefits.
13 February: FICOD (FC.06)
EIOPA clarified in Q&A (#3251) that the total amount of the exposures to be reported in FC0250 is the total exposure towards a single counterparty.
13 February: FICOD
EIOPA clarified in Q&A (#3250) that FICOD reporting is not limited to transactions that are terminated at the end of the reference period but shall encompass any transaction that was in force even at a single point of time during the reporting period.
13 February: FICOD
EIOPA clarified in Q&A (#3249) that undrawn amount credit facilities shall be reported in template FC.03 while drawn amount are expected to be reported in template FC.01.
13 February: FICOD
EIOPA clarified in Q&A (#3248) the following with regard to declaring indirect transactions under FICOD: “the concept of ‘single economic operation’ (SEO) is distinct from “indirect transaction” concept and such SEO concept is not expected to be used for identifying several transactions that are “connected” to form an ‘indirect transaction’.” EIOPA also provided a summary table for the different cases of intra-group transactions.
13 February: FICOD (FC.01 – FC.03)
EIOPA clarified in Q&A (#3247) that when a repurchase agreement reaches the significance threshold under FICOD, it shall be reported under two operations:
- the “cash leg” shall be considered as a loan and reported as such in table FC.01
- The “securities leg” shall be considered as a forward contract and reported as such in table FC.02
13 February: FICOD (FC.0 & FC.05)
EIOPA clarified in Q&A (#3246) that FC.05 categories that do not match with FC.0 specific items are expected to be reported as ‘fees and other incomes. EIOPA have also illustrated a mapping from FC.05 to FC.0.
13 February: FICOD (FC.01 & FC.05)
EIOPA clarified in Q&A (#3245) that with regard to FC.01 and FC.05, reporting by conglomerates is expected on a year-to-date basis.
13 February: FICOD (FC.06)
EIOPA clarified in Q&A (#3063) that the column ‘Assets whose risks are mainly borne by the policyholders’ should reflect the value of assets in relation to unit-linked or index-linked life insurance contracts.
13 February: Article 179; 180(2); 184(2)(d)
EIOPA clarified in Q&A (#2308) that with regards to a total return swap that has an index-linked bond as its underlying asset, the underlying exposure should be included in the determination of the capital requirement for spread risk on credit derivatives unless the bond is included in the list of exposures set out in Article 180(2) DR.
04 February: Article 138
EIOPA provided in Q&A (#2573) clarification given by the European Commission on the calculation of capital requirements for longevity risk in the context of collective pension schemes for employees.
