PRA issues policy statements: PRA has issued:
- feedback and a Statement of Policy on policyholder protection. The statement covers:
- compensation limits: following consultation, PRA has decided not to introduce a cap on large claims, to leave general insurance compensation as proposed, but to increase the compensation on all long-term insurance products to 100%;
- successor firms: the Financial Services Compensation Scheme (FSCS) will protect policyholders who have outstanding protected claims against an insurer whose claims were within FSCS scope before the policies transferred to a successor firm; and
- assignment and subrogation: FSCS will have new powers of automatic and electronic assignment and automatic subrogation of policyholders’ rights, which it can use when seeking redress from failed insurers and third parties.
PRA has made Policyholder Protection rules and a Lloyd’s direction and rule alongside a Statement of Policy setting out its expectations of FSCS; and
- documents on depositor guarantees and the dormant accounts scheme together with feedback on previous papers and a further consultation on a few points arising from them. PRA has made:
- the Depositor Protection, Dormant Accounts Scheme, Management Expenses, and Base Costs and Management Expenses in respect of Relevant Schemes parts of the PRA Rulebook;o consequential minor changes to existing rules;
- a supervisory statement setting out PRA’s expectations in respect of Depositor Protection part of the PRA Rulebook; and
- statements of policy setting out PRA’s expectations of FSCS in respect of Depositor Protection and Dormant Accounts Schemes parts of the PRA Rulebook.
It asks for comment on the further consultation by 1 May. (Source: PRA Policy Statements on Policyholder Protection and Depositor Protection)
PRA updates Solvency 2 approval forms: PRA has published a set of new forms for Solvency 2 approvals, following the European Commission's publication of its Set 1 Implementing Technical Standard. There are 11 new forms. (Source: PRA Updates Solvency 2 Approval Forms)
PRA publishes Part 2 of its Rulebook: PRA has published a policy statement on its creation of the next part of its Rulebook. PRA intends its Rulebook to replace the provisions currently shared with the FCA's Handbook by summer 2015. Part 2 contains:
- Rulebook glossary terms;
- verification of standing data rules;
- general provisions rules;
- internal governance rules; and
- Handbook consequentials.
Alongside these rules, PRA has published:
- supervisory statements on internal governance, functions relating to building societies and supervision of building societies' treasury and lending activities; and
- a statement of policy on its approach to insurance business transfers.
It has also published a derivation and destination table mapping the Handbook rules to the PRA Rulebook. The new rules all took effect on 2 April. (Source: PRA Publishes Part 2 of its Rulebook)