On 23 October, EIOPA released Solvency II updates that amended the Final Report on public consultation No. 14/048 on Guidelines on the supervision of branches of third-country insurances undertakings1. The amendment specifies reporting requirements for third-country branches, defined as any insurer headquartered outside the EU, but with a branch in the EU.
These updates are intended to help EIOPA ensure that if a third-party insurer goes out of business, any EU policyholders will still be protected, and that their location outside the headquarter country won’t impact their claim priority.
For example, Insurer A is headquartered in Bermuda and has a branch in the UK. Bermuda will likely be granted equivalency by EIOPA, so Insurer A will not need to file Solvency II reports and will instead file BMA reports. However, the PRA can decide that Insurer A’s individual UK branch needs to file Solvency II reports.
With this update, third-country branches have several additional data points to provide throughout the Solvency II templates. With regard to Clearwater’s Solvency II templates, the S.06.02 – List of Assets has two new data points:
This update means that any insurer with branches in the EU could be impacted by Solvency II reporting in unforseen ways. Third-party branches need to start planning for the possibility of new, highly detailed and complex reporting requirements. Clearwater is dedicated to keeping insurers up-to-date, as EIOPA continues to fine-tune their requirements for both EU and third-party branches.