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EU-US Covered Agreement on Insurance and Reinsurance Measures
13th January 2017 - European Securities and Markets Authority

The European Insurance and Occupational Pensions Authority (EIOPA) has welcomed the EU-U.S. Covered Agreement on insurance and reinsurance measures released on the 13th January 2017 by the European Commission and the U.S. Department of the Treasury.

A covered agreement is an agreement between the U.S. and one or more foreign governments, authorities or regulatory entities regarding regulatory measures with respect to insurance or reinsurance.

The Covered Agreement covers three areas of prudential insurance oversight:

  • Reinsurance
  • Group supervision
  • Exchange of information between supervisors

 

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Finalised guidance for the fair-treatment of insurance closed-book customers
9th December 2016 - Financial Conduct Authority

The Financial Conduct Authority (FCA) has published its finalised guidance providing firms with detailed information on the actions they should be taking in order to treat their closed-book customers fairly.

The FCA wants to ensure that closed-book customers, who have life insurance products that are closed to new business, are treated fairly and do not receive less attention than customers who have recently taken out a new product.

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Potential Harmonisation of Recovery and Resolution Frameworks for Insurers
2nd December 2016 - European Insurance and Occupational Pensions Authority

The European Insurance and Occupational Pensions Authority (EIOPA) has published a Discussion Paper on Potential Harmonisation of Recovery and Resolution Frameworks for Insurers which is recommending a minimum degree of harmonisation to facilitate cross-border cooperation and coordination and provide the European Union Member States the flexibility to address any specificities of their national insurance market.

EIOPA proposes four building blocks of a harmonised recovery and resolution framework for insurers and these four blocks are: Preparation and Planning, Early Intervention/Recovery, Resolution and Cooperation and Coordination.

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Solvency II: group supervision
7th November 2016 - Prudential Regulation Authority

The Consultation Paper (CP) proposals are intended to clarify for firms which aspects of the PRA’s letter ‘Solvency II: An update on implementation’ published on 25th July 2014 on group supervision are now intended to have effect as ongoing supervisory expectations.

The CP also includes proposals to address elements of the Solvency II legislation introduced after the publication of the relevant letters; including the Solvency 2 Regulations 2015 and to update it with references to the PRA Rulebook.

These proposals will result in the consolidation of PRA expectations in respect of Solvency II group supervision, as they are intended to be implemented in the form of an update to the current SS9/15

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Distributable profits of long-term (life) insurers
25th October 2016 - Her Majesty's Treasury

The Companies Act 2006 (“the Act”) sets out the legal basis on which companies are formed and run. However, long-term insurance differs from many businesses in that its business cycle from initiation to final contract settlement has a term that may span multiple financial periods and changes to the Act became necessary following the implementation of the Solvency 2 Directive (“Solvency 2”) on 1st January 2016.

This consultation seeks views on technical changes to the legal definition of life insurers’ distributable profits. This definition affects how life insurers calculate the profits available for distribution to their shareholders. The changes are needed to update the law to reflect changes to the regulation of life insurers.

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Dealing with a market turning event in the general insurance sector
21st September 2016 - Prudential Regulation Authority

In this consultation paper (CP), the Prudential Regulation Authority (PRA) sets out a draft supervisory statement (SS) on its expectations of general insurance firms regulated by the PRA, in relation to significant general insurance loss events which might affect firms’ solvency and future business plans.

The SS sets out the PRA’s expectations of how such firms, particularly those operating in the global specialty insurance and reinsurance market known as the London market, might plan for and respond to such an event.

At the time of writing, the PRA also issued Supervisory Statement 12/16 ‘Solvency II: Changes to internal models used by UK insurance firms’ – (please see the ‘Links tab).

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Review of the client money rules for insurance intermediaries - withdrawn
16th August 2016 - Financial Conduct Authority

The Financial Conduct Authority (FCA) has today written to firms providing an update on Consultation Paper 12/20: Review of the client money rules for insurance intermediaries, where it had proposed some changes to the rules and guidance in Chapter 5 of the Client Assets Sourcebook (CASS). The proposed changes have now been withdrawn.

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Increasing transparency and engagement at renewal in general insurance markets
10th August 2016 - Financial Conduct Authority

In this Policy Statement the FCA report on the main issues arising from Consultation Paper 15/41 - Increasing transparency and engagement at renewal in general insurance markets - and confirm the final rules and non-Handbook guidance.

The FCA are proceeding with the proposals as consulted on but have made some changes in response to feedback received.

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Rules and guidance on payment protection insurance complaints
2nd August 2016 - Financial Conduct Authority

In this consultation paper, the FCA outline feedback received to consultation paper (CP) 15/39 (November 2015) and give their responses to that feedback

The FCA highlight areas where they have amended their proposals because of feedback, set out revised proposed rules and guidance reflecting those amendments, invite further comments on the revised proposed package as a whole and outline what happens next.

The FCA believe that, overall, the package of proposals on payment protection insurance complaints laid out in CP15/39 should be taken forward.

However, they are also consulting further on some changes to the proposed rules and guidance concerning the handling of PPI complaints in light of the Supreme Court’s decision in Plevin v Paragon Personal Finance Ltd (Plevin)

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Principals and their appointed representatives in the general insurance sector
22nd July 2016 - Financial Conduct Authority

This report sets out the findings from the latest FCA thematic review of principal firms and their appointed representatives in the general insurance sector, although it is relevant to all firms with appointed representatives.

The review focused on principal firms’ understanding of their responsibilities for their appointed representatives and oversight of their activities.

The work addressed all phases of the relationship, from the initial selection and appointment of ARs, through set-up and contracting, to the ongoing oversight and termination of ARs

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Technical Advice on possible delegated acts concerning the Insurance Distribution Directive
4th July 2016 - European Insurance and Occupational Pensions Authority

The European Insurance and Occupational Pensions Authority (EIOPA) has published a Consultation Paper on its draft technical advice to the European Commission on possible delegated acts concerning the Insurance Distribution Directive (IDD)

EIOPA invites all interested parties to provide their feedback on the policy proposals with regard to the following areas:

  • Product oversight and governance arrangements requiring manufacturers of all insurance products to establish processes for company-internal approval of each insurance product before it is distributed to customers
  • Organisational arrangements to prevent and manage conflicts of interests which may arise between distributors and their customers (e.g. inappropriate sales incentives) in the course of distribution of insurance-based investment products (IBIPs)
  • Specification of the circumstances under which, inducements, namely, third party payments such as commissions paid by manufacturers to distributors in connection with the distribution of IBIPs, have a detrimental impact on the quality of service provided to the customer
  • Specification of the information which distributors should obtain from their customers to be in a position to assess the suitability or appropriateness of IBIPs for the customer and reporting on the service provided to the customer

Solvency II: Changes to internal models used by UK insurance firms
5th May 2016 - Prudential Regulatory Authority

This supervisory statement sets out the Prudential Regulation Authority’s (PRA) expectations in respect of firms applying for approval for a major change to their approved internal models (either an individual major change or major change triggered by an accumulation of minor changes) or an extension of scope to an approved internal model (e.g. to cover new business units or risks).

It also sets outs the PRA’s expectations in respect of firms applying for a change to their approved internal model change policy.

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Reporting requirements for non-Solvency II insurance firms
3rd May 2016 - Prudential Regulatory Authority

This Consultation Paper sets out proposals for new reporting rules in the Prudential Regulation Authority (PRA) Rulebook that would apply to insurance firms that are outside the scope of Solvency II from 1st January 2016. Collectively, these firms are referred to as non-directive firms (NDFs).

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Fair treatment of long-standing customers (life insurance)
3rd March 2016 - FCA

In the FCA’s Business Plan 2014/15, the regulator reported that they would be conducting a thematic review to assess how firms were operating their closed-books and to determine if they are treating their long-standing customers fairly.

The FCA has identified some risks which could lead to long-standing customers being treated unfairly, such as firms benefiting from customer inertia by keeping them in high-charging, poorly performing products or by cutting costs in a way that was detrimental to customers.

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Insurance linked securities
1st March 2016 - FCA

This consultation seeks views on a new regulatory and tax framework for Insurance Linked Securities (ILS) business in the UK.

With ILS now being an important part of the global specialist reinsurance market the consultation examines what will be needed for an effective and competitive approach to the authorisation and supervision, corporate structure and taxation of ILS vehicles.

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