Solvency II map updated

By Christopher Cundy

InsuranceERM has updated its Solvency II map using the data released by the European Insurance and Occupational Pensions Authority (Eiopa) last month.

The authority's report on the use of the long-term guarantee (LTG) measures in Solvency II and the results of the stress test include detailed information on the application of Solvency II in each European Economic Area country.

One third of the 3,050 insurers subject to Solvency II are using LTG measures, but in terms of technical provisions, they represent more than two-thirds of the insurance market.

The volatility adjustment is by far the most popular LTG measure, used by 852 insurers, while the matching adjustment is only used in the UK and Spain (39 firms in total).

In eight countries, including Poland, Malta and Slovenia, there are no insurers applying LTG measures.

In terms of the measures aimed at easing the switch between Solvency I and Solvency II, the transitional measure on technical provisions is by far the most popular (124 firms). The transitional on the risk-free rate is used by only five insurers.

Just one insurer, based in France, is using the duration-based equity risk sub-module, a transitional measure that phases-in the introduction of equity capital charges.

Solvency II also has a transitional measure on the solvency capital requirement (SCR), giving firms two years to bring themselves up to the required level, under certain conditions.

Some 41 firms are under the SCR transitional, including six each in Luxembourg and Portugal, five in France, and four each in Ireland, Spain and the UK.

Eiopa also revealed the extent internal model use, although it did not break this down by country.

Eiopa's data is based on submissions to national supervisors as of 1 January and 30 March 2016.

InsuranceERM surveyed national supervisors in mid-2016 and where our information differs from Eiopa, we have used our more recent data.

Subscribers can see the map here.