Question
TP(life,4) denotes the technical provisions without a risk margin for all other life insurance and reinsurance obligations, after deduction of the amounts recoverable from reinsurance contracts and special purpose vehicles, with a floor equal to zero;
Imagine following situation:
Net BEL + net TP as a whole on LoB 32 = - 383 565 CZK
Net BEL + net TP as a whole on LoB 34 = 313 542 CZK
Both LoB 32 and LoB 34 belong to the TP(life,4) as definec in Article 251, par. 1, letter d).
What is the correct interpretation of "with a floor equal to zero". Should it be applied to LoB all to TP(life,4)? In other words, in case of the aforementioned example is correct a or b:
a) TP(life,4) = 313 542 CZK
b) TP(life,4) = 0 CZK (as -383 565 + 313 542 <0).
EIOPA answer
In case the insurer has technical provisions as defined in Article 251(1)(d) of Commission Delegated Regulation (EU) 2015/35 from different business lines the floor is to be applied to the total and not per business line.