PRA Policy Statement 1/22: Insurance business transfers
We review the key amendments to the PRA’s Policy Statement 1/22 on insurance business transfers and consider the potential implications.
Building on previous Milliman publications, this report provides a summary of the Solvency II based metrics that a sample of 21 companies in Europe are disclosing at year-end 2020 and considers whether and how the approaches adopted when determining these metrics have changed since year-end 2019. 2020 was an atypical year–with the emergence of the global COVID-19 pandemic–and so in this report, we consider how the pandemic has impacted firms in our sample by looking at their disclosed supplementary reporting metrics, level of Solvency II Own Funds and solvency positions. We also examine the appropriateness of the use of Solvency II Own Funds as a benchmark for the prices agreed in recent transactions, adding another year’s worth of data to the analysis in last year’s Milliman publication. Finally, we consider recent regulatory developments, in particular EIOPA’s ongoing Solvency II 2020 Review as well as the UK government’s own review of Solvency II, and how these developments may impact the metrics disclosed by companies in Europe for both reporting and transaction purposes.