EIOPA recently published an opinion on group supervisors’ approach towards third country capital requirements to be used for calculating group solvency for insurance groups operating in a Solvency II equivalent third country. In order to ensure supervisory convergence in respect of such groups, EIOPA recommends that NCAs apply the highest level of capital requirement in the third country for calculation of the group solvency position. It also urges groups to form an economic view of the level of risk associated with the business conducted in the equivalent third country. EIOPA recommends that the group supervisor monitor and take that economic view into account, perhaps as part of the own risk and solvency assessment of the insurance group. The opinion sets out recommendations regarding the assessment of the availability of eligible own funds at group level. In the Annex, two potential third country group examples are set out - the US and Brazil.
A link to the opinion is here.