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The Opinion is of relevance for insurance groups that operate outside the European Economic Area (EEA) in third countries whose solvency regimes are considered equivalent to Solvency II.
Gabriel Bernardino, Chairman of European Insurance and Occupational Pensions Authority (EIOPA), said: "Supervisory convergence is an essential element in the implementation of Solvency II and is a high priority on EIOPA's agenda. With this Opinion, EIOPA intends to achieve a level playing field for the EU insurance groups by securing consistent practices by National Competent Authorities (NCAs)".
In its Opinion, EIOPA recommends NCAs to apply the highest level of capital requirement in the third country for calculating the group solvency position. Own funds should be deemed unavailable in case they are below the threshold triggering intervention by the third country supervisory authority.
Furthermore, groups should form an economic view of the risks inherent in the business conducted in the third country. This economic view and intra-group transactions should be monitored by the group supervisor, for instance as part of the Own Risk and Solvency Assessment (ORSA) of insurance groups.
EIOPA is going to monitor the development of the issues addressed in the Opinion.