On 28 March 2018, the PRA published a policy statement, PS4/18, which provides feedback on responses to its December 2017 consultation paper, CP30/17, on the PRA's approach to international insurers branch authorisation and supervision.
A related new Supervisory Statement (SS) SS2/18 is included as a link in the appendix to the policy statement. This introduces new factors to be considered alongside the PRA's current requirements for third-country branch authorisation. SS44/15 "Solvency II: third-country insurance and reinsurance branches" remains unchanged. In particular, SS2/18 sets out the PRA's expectations on when a subsidiary would be more appropriate than a branch for a third-country insurer wishing to carry out insurance business in the UK. The PRA made one material change to the supervisory statement following the consultation, to increase the Financial Services Compensation Scheme-protected liabilities threshold from 200 million to 500 million.
The new approach comes into effect from 29 March 2018. For EEA firms currently branching into the UK under passporting arrangements and intending to apply for PRA authorisation in order to continue operating in the UK after the UK's withdrawal from the EU, this approach would be relevant to authorisations for this purpose.