EIOPA has proposed a number of amendments to the adopted Solvency II Technical Standards on Reporting and Disclosure. The amendments are divided into type 1 and type 2 where type 1 is amending provisions and type 2 are corrective provisions. Needless to say the type 1 amendments may have significant impact on the reporting done by the regulated insurance companies.
According to EIOPA the proposed amendment to the technical standard aims at providing legal certainty, contribute to a better understanding of the current requirements, improve consistency of the application of the technical standards and generally improve the quality of the information reported. The corrections that are amendments from a legal perspective aim to increase consistency among the reporting framework (amendment 4), 6) and 7) below), facilitate processing and validation by both undertakings and regulators (amendment 1), 2), 3) and 8) below) and reflect on unintended disproportionate costs regarding the look-through approach of non-material exposers (amendment 5) below).
The type 1 amendments are:
- Introduction of new types of undertakings in the closed list of S.01.02.C0010/R0040;
- Introduction of new item in S.01.02 indicating the date of the financial year end (we assume this is to allow for non-calendar financial years);
- Introduction of new options in closed list for ad-hoc reporting in S.01.02.C0010/R0100;
- Inclusion of investment contracts in the scope of S.04/S.05;
- Flexibility in the application of look-through in S.06.03 (current more elaborate approach still allowed to avoid re-implementation)
- Alignment between templates S.12 and S.17 and within templates in relation to amounts of TP after use of transitional and other measures;
- Consideration of accumulated amounts in S.21.01;
- Nominated ECAI in several templates: standardisation of data, replacement of name by a closed list including LEI-code and name.
We do not think any of these amendments pose a serious challenge for the regulated companies at this moment.
There are many more type 2 amendments than type 1:s, but since they are of a corrective nature EIOPA do not anticipate any major efforts required to adjust the reporting of an undertaking with respect to these. However, these will have to be reviewed by respective undertaking to ensure any clarifications and corrections have not affected the current interpretation.