On Sep. 25, UK PRA issued statement on Solvency II rule waivers.
PRA issued statement to provide an update to firms that hold existing PRA directions in respect of waivers or modifications of PRA rules in relation to Solvency II.
Potential changes may be required to wording of these directions in order to reflect the final PRA rules following review of Solvency II, which will come in effect Dec. 31, 2024.
Follows UK PRA Apr. 2024 consulted on restatement of assimilated law, see #209496.
Also follows UK PRA Sep. 2024 statement on publication of final rules, see #227106.
Statement
Statement is relevant to all PRA-regulated UK Solvency II firms and groups that are currently subject to PRA directions containing waiver or modification of PRA rules.
PRA confirms that a separate letter will be issued to third-country branches shortly.
Will publish its final package of rules relating to Solvency II Review in mid-Nov. 2024.
PRA has issued 3 major policy statements on Review, PS2/24Adapting to the UK insurance market (see #202884); PS3/24Reporting and disclosure phase 2 near-final (see #203017); and PS10/24Reform of the Matching Adjustment (see #214968).
Aims to publish final PS re CP5/24Restatement of assimilated law, in mid-Nov 2024.
These final rules, which will come into force on Dec. 31, 2024, may affect existing PRA directions in respect of waivers or modifications of PRA rules held by insurance firms.
In particular, where waivers/modifications include references to Solvency II assimilated law or PRA Rulebook, may need to be updated to reflect the final PRA rules.
Next Steps
In mid-November, PRA will contact affected firms to provide further instructions and request consent to vary the working of their existing directions (where necessary) so they will remain valid from Dec. 31, 2024, aims to make this as simple as possible.
PRA will provide more details to firms by adding updates on its webpages: Waivers and modifications of rules; Solvency II; and Regulatory reporting - insurance sector.
When details of the process are available, affected firms will need to provide consent before Dec. 30, 2024 to ensure that the directions can continue and reflect new rules.
In the meantime, firms should familiarize themselves with the relevant waivers and modifications they currently hold, firms will not be required to submit new applications for their existing modifications to be varied.
