Participation in the QIS5 exercise is advised for all European insurers in order to test the impact of Solvency II on firms’ balance sheets.
The European Commission has published for consultation draft technical specifications for a fifth quantitative impact study (QIS5). In addition, the Commission has published a draft call for advice for the Committee of European Insurance and Occupational Pensions Supervisors (CEIOPS) to run QIS5 from August to November 2010.
QIS5 aims to provide the industry and authorities with detailed information on the quantitative impact of Level 2 measures on firms’ solvency balance sheets, in addition to ensuring that the technical specifications are aligned with the principles and calibration targets of the Level 1 Framework Directive.
The Commission are keen to ensure that as many insurance and reinsurance undertakings as possible take part in this final testing exercise. They expect at least 60 per cent of all insurers and reinsurers in Europe and at least 75 per cent of European insurance groups to participate.
In particular, the Commission encourage small and medium sized firms to take part in QIS5 in significant numbers in order to test the impact of Solvency II on their balance sheets.
In the light of concerns that the technical specifications from CEIOPS would result in a significant increase in capital requirements as compared to those in QIS4, the Commission has made certain modifications to the technical specifications. Further changes are expected to be made to the technical specifications as a result of ongoing discussions and the outcome of QIS5. Details of the main changes included by the Commission for the purpose of QIS5 are contained in the cover note published alongside the technical specifications.
The Commission expect all individual firms participating in QIS5 to send in their submission to their national supervisors by 31 October 2010. Insurance groups are expected to send their submission to CEIOPS and their national supervisors by 15 November 2010.
For further information: Cover note to accompany the draft QIS5 technical specifications
For further information: Draft technical specifications