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The CEA sets out ten buildings blocks that the insurance industry believes to be crucial to ensure the protection of policyholders’ interests, an economic approach and the practicality and comprehensibility of the approach when determining the capital available to cover the capital requirements.
The CEA agrees with the principles set for the identification and classification of own funds, but believes that the characteristics used to classify the elements of capital by CEIOPS in its QIS4 quantitative impact study are clearer than those set out in the Framework Directive.
On the assessment of own funds, the CEA is in favour of the quality of the own funds being assessed as a whole and on an economic basis and suggests appropriate amendments to the Directive.