EIOPA: QIS5 presentation at stakeholder hearing
28 March 2011
The European Insurance and Occupational Pensions Authority (EIOPA) published slides presented at a stakeholder hearing on the results of the fifth quantitative impact study (QIS5) of the Solvency II capital rules.
QIS5 process:
• Ownership of technical specifications: European Commission
• “Double” calculations (no default approach set by the EC)
• Calculation with and without transitional provisions for discounting
• Internal Models and Standard Formula calculation
• Modular approach and equivalent scenario for the adjustment for the loss-absorbing capacity of technical provisions and deferred taxes
• Groups: accounting consolidation as well as aggregation and deduction method
“Alternative” approaches: QIS5 to collect information to assess the impact of the issues and/or enable comparisons on potential alternatives (default defined by EC)
• Value of participations based on SCR of the undertaking in which the participation is held
• Introduction of the illiquidity premium in risk free rate
• Risk margin:
- with diversification between lines of business (solo)
- without diversification between entities at group level
• Transitional provisions for own funds
• Tiering of expected profits in future premiums
• EIOPA and Commission verifying national guidance
© EIOPA
