KPMG comments on the final set of rules for the UK version of Solvency II

Commenting on the publication by the PRA of PS10/24, the final set of rules for the UK version of Solvency II

Commenting on the publication by the PRA of PS10/24, the final set of rules for the UK

Huw Evans, Head of Insurance at KPMG UK, said:

“This is a case of evolution, not revolution. These rules ensure a more distinct UK Solvency II regime with some greater flexibility to invest in long-term assets such as infrastructure. Alongside this, are more complex rules policing the Matching Adjustment mechanism."

“The PRA’s creation of Solvency UK has made improvements that will work better for the UK than the original regime. With the EU having also made changes to Solvency II, there is nothing in the final UK version that would prevent it being deemed ‘equivalent’ to the EU’s regime in due course.”

“This final set of rule changes to Solvency II will only affect life insurance and insurers selling individual or group protection products in the UK that use the Matching Adjustment mechanism now or in the future."

James Isden, Insurance Partner at KPMG UK, added:

“Insurers will welcome the new Matching Adjustment regime starting earlier on 30th June and will appreciate that the PRA did not delay publication of these much-anticipated rules because of the General Election."

“While the new rules will allow greater investment in assets with ‘highly predictable’ cash flows, the reporting, calibration and attestation requirements that will come with it are still onerous, especially for smaller insurers. Insurers who write group income protection will welcome the inclusion of in-payment group policies within the MA regime.”

Alisa Dolgova, Insurance Prudential Regulation Sector Head for KPMG’s EMA FS Regulatory Insights Centre, said:

“The PRA has been given significant new powers to police how insurers use the Matching Adjustment. The extent to which regulators use all the tools at their disposal to oversee use of the MA will partly determine whether these reforms achieve the stated objective of the Government to have a more flexible and internationally competitive regime.”




For further information please contact:

KPMG Media Relations

Gerard Swinley

M: +44 7510 375540


About KPMG

KPMG LLP, a UK limited liability partnership, operates from 20 offices across the UK with approximately 18,000 partners and staff. The UK firm recorded a revenue of £2.96 billion in the year ended 30 September 2023. 

KPMG is a global organisation of independent professional services firms providing Audit, Legal, Tax and Advisory services. It operates in 143 countries and territories with more than 273,000 partners and employees working in member firms around the world. Each KPMG firm is a legally distinct and separate entity and describes itself as such. KPMG International Limited is a private English company limited by guarantee. KPMG International Limited and its related entities do not provide services to clients. 

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