Ceiops - Solvency II - Expert Groups

Solvency II - Expert Groups

Solvency II - Financial Requirements Expert Group

Solvency II - Internal Governance, Supervisory Review and Reporting Expert Group

Solvency II - Internal Models Expert Group

Solvency II - Insurance Groups Supervision Committee

CEIOPS Work Plan for Solvency II Deliverables 2007-2012

Background

At the 32nd EU Insurance Committee meeting in April 2003, representatives of the Member States endorsed the proposal by the European Commission regarding the fundamental principles for the design of a future prudential system for the supervision of insurance undertakings in the EU, i.e. the Solvency II Project. The design is based on a “three pillars approach”, in which, in principle, Pillar I regards financial requirements, Pillar II refers to the supervisory review process and qualitative aspect of management and Pillar III includes disclosure requirements.

In developing this project, the European Commission calls for CEIOPS' technical advice and support according to the policy principles and guidelines set by the "Framework for Consultation on Solvency II".
In view of receiving requests for advice by the Commission and in order to appropriately cover the whole Solvency II project, CEIOPS had established in the spring of 2004 an “ad hoc” organisation devoted to the project. The Expert Groups in charge of preparing CEIOPS’ deliberations had been tailored according to the fundamental lines of the new prudential model, i.e. the “three pillars approach” and not to the expected specific Calls for Advice, nor to the way in which the future regime will be translated into formal requirements according to the "Lamfalussy process".

In line with this approach, CEIOPS created initially five Expert Groups:
Two groups were given the tasks of conducting preparatory work on Pillar I issues respectively for "life" and "non life" insurance business, in particular providing analysis on capital requirements and technical provisions. Two further groups were mandated to carry out preparatory work on the areas included respectively in Pillar II and Pillar III. Separately, in view of the need to assess these issues also from the viewpoint of groups of undertakings, as well as to take into account aspects of the integration between financial sectors, another group was asked to analyse the implications for the supervision of groups and cross-sector activities. Considering the close relationship between financial disclosure and the accounting framework, the Expert Group on Pillar III also dealt with accounting developments relevant to insurance.

In line with this approach, CEIOPS created initially five Expert Groups: Two groups were given the tasks of conducting preparatory work on Pillar I issues respectively for "life" and "non life" insurance business, in particular providing analysis on capital requirements and technical provisions. Two further groups were mandated to carry out preparatory work on the areas included respectively in Pillar II and Pillar III. Separately, in view of the need to assess these issues also from the viewpoint of groups of undertakings, as well as to take into account aspects of the integration between financial sectors, another group was asked to analyse the implications for the supervision of groups and cross-sector activities. Considering the close relationship between financial disclosure and the accounting framework, the Expert Group on Pillar III also dealt with accounting developments relevant to insurance.

As the definition of CEIOPS' advice entails carrying out Quantitative Impact Studies (QIS), it was considered appropriate to ask the Financial Stability Committee, which has been established within CEIOPS with the main objective of dealing with a macro-prudential surveillance programme based on market indicators, to assist the Expert Groups and coordinate their data collection exercises.

Given the clear correlation between the areas dealt with by the above mentioned groups, a coordination arrangement has been created to ensure consistency among the groups' activities and avoidance of overlaps. The Managing Board and the Secretariat play a significant role in this.

In May 2005, the two Expert Groups on life and non-life issues merged into one group "Pillar I Expert Group".

In essence, the four Solvency II Expert Groups' tasks was to do the preparatory work for CEIOPS to provide the European Commission with the elements for drafting its proposal for a Framework Directive on Solvency II.

After delivering this advice, CEIOPS, in June 2007, decided to revise its operational structure dedicated to the project. CEIOPS considers that the consequent changes will enable it to accomplish its tasks under the forthcoming stages of the Solvency II project efficiently and effectively. These changes derive mainly from the need to take care of the most urgent need for technical advice following the presentation of the European Commission’s proposal, including preparation of advice on a number of implementing measures and consideration of subsequent supervisory measures.

To view each Solvency II Working Group's specific mandate, please click on the above listed Working Groups.

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