PRA consults on SIMR for non-Solvency 2 firms: In conjunction with the consultations discussed under FCA above, PRA is consulting on how it intends to apply the Senior Insurance Managers Regime (SIMR) to insurance firms that are outside the scope of Solvency 2. It proposes to:

  • simplify the list of controlled functions so there is a single small insurer senior management function;
  • create a bespoke regime for assessing fitness and propriety of individuals running these firms; and
  • apply conduct standards in an appropriate manner to these firms.

There will be five modules of the PRA Rulebook devoted to these rules. It asks for comment by 15 May. (Source: PRA Consults on SIMR for Non-Solvency 2 Firms)

PRA comments on Solvency 2 matching adjustment: PRA has concluded the pre-application process for the Solvency 2 matching adjustment and is now providing feedback to help firms with their formal applications. The feedback will be particularly important to UK insurers intending to apply to PRA for approval to use the matching adjustment, as it highlights matters to be addressed in formal applications and further details how the eligibility criteria should be applied. This feedback follows on from three previous PRA communications regarding the matching adjustment issued on 15 October 2014, 20 February and 9 March. The application process for matching adjustment approvals opens on 1 April. (Source: PRA Provides Feedback on Solvency 2 Matching Adjustment Pre-application Process)

PRA consults on internal models treatment of sovereign debt: PRA is consulting on the treatment of sovereign debt in internal models under Solvency 2. PRA has produced a short draft supervisory statement aimed at supporting the Solvency 2 requirements and ensuring firms using internal models take proper account of the material risks associated with sovereign debt. It asks for comment by 1 May. (Source: PRA Consults on Internal Models Treatment of Sovereign Debt)

PRA confirms MELL: PRA has confirmed the Management Expenses Levy Limit (MELL) for the FSCS for the coming year will be £74.4 million. (Source: PRA Confirms MELL)

PRA makes rule changes: PRA has made instruments confirming minor changes to rules within its Rulebook and Handbook. The amendments relate to the Fees and Supervision Manuals within the Handbook, and the Internal Capital Adequacy Assessment, Definition of Capital and Capital Buffers parts of the Rulebook. All changes took effect on 31 March. (Source: PRA Handbook Amendments andPRA Rulebook Amendments)