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European Insurance and Occupational Pensions Authority

1653

Q&A

Question ID: 1653

Regulation Reference: (EU) No 2015/2450 - templates for the submission of information to the supervisory authorities

Article: 35, 250, 251

Template: S.28.02

Status: Final

Date of submission: 06 Nov 2018

Question

We would like confirmation if our below approach for calculation of R0300 “Linear MCR” in QRT S.28.02.01 is correct (only the use of the split in life and non-life activity is in question):

First we take the Linear formula component for Non-Life obligations as in Article 250 of Delegated Regulation where the sum is only taken over the different segments and there is no segmentation between life and non-life activity. Meaning that for TP(nl,s) and Ps the floor equal to zero applies on the total of life and non-life activity (and can therefore be different from the sum of respectively C0030+C0050 and C0040+C0060 for a segment s).

Second we take the Linear formula component for Life obligations as in Article 251 of Delegated regulation where all 4 components TP(life,.) are taken without segmentation between life and non-life activity. Meaning that each component again can be different from the sum of C0090 + C0110.

Third step: add up above two items.

EIOPA answer

When calculating the linear formula component for non-life insurance and reinsurance obligations in accordance with Article 250 of Commission Delegated Regulation (EU) 2015/35,  for a segment s the floor of zero should be applied to the technical provisions without a risk margin for non-life insurance and reinsurance obligations in the segment s after deduction of the amounts recoverable from reinsurance contracts and special purpose vehicles and not to any sub-component of them.
The same applies also for the technical provisions referred to in Article 251 (1) (b) to (d).