EIOPA · 1274
Solvency Capital Requirement (SCR)
- Regulation
- (EU) No 2015/35 - supplementing Dir 2009/138/EC - taking up & pursuit of the business of Insurance and Reinsurance (SII)
- Article
- 9
- Topic
- Solvency Capital Requirement (SCR)
- Submitted
- 2017-04-18
- Answered
- 2021-07-07
Question
As Solvency II proposes to use International Accounting Standard 19 (IAS 19) as the basis for the recognition of amounts relating to employee pension schemes on the Solvency II balance sheet, small insurance undertakings struggle to implement these provisions in a way that is feasable in each individual situation. To find a feasible solution in this situation, we consider, by way of derogation from IAS 19 and in particular by respecting the principle of proportionality, to apply Art. 9(4) of Delegated Regulation (EU) 2015/35 for Liechtenstein’s insurance market in this regard. What is your view on this proposal?
Answer
We understand that these cases are within the scope of Art. 9 (4) of Delegated Regulation 2015/35. If market-consistent valuations are ensured, these undertakings are exempted from using IFRSs. In order to endorse market consistent valuations, we support the use of safeguards, such as annual expert reports regarding the financial soundness and robustness of the pensions obligation.
This Q&A is published by European Insurance and Occupational Pensions Authority and is non-binding. It does not constitute legal advice. Updated weekly from official ESA sources.
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