We would like to confirm the application of the pandemic risk sub-module in the health catastrophe risk module specifically to similar to life techniques (SLT) health business.

Article 144(4) of Commission Delegated Regulation (EU) 2015/35 (DR) states:

"Insurance and reinsurance undertakings shall apply:

(a) the NSLT health underwriting risk sub-module to health insurance and reinsurance obligations included in lines of business 1, 2, 3, 13, 14, 15 and 25 as set out in Annex I;

(b) the SLT health underwriting risk sub-module to health insurance and reinsurance obligations included in lines of business 29, 33 and 35 as set out in Annex I;

(c) the health catastrophe risk sub-module to health insurance and reinsurance obligations."

Article 160(2) DR states: "Insurance and reinsurance undertakings shall apply […] (c) the pandemic risk sub-module to health insurance and reinsurance obligations other than workers' compensation insurance and reinsurance obligations."

Which we interpret in such way, that the pandemic risk sub-module should apply to all health obligations (other than workers' compensation), irrespective of whether they are NSLT or SLT.

Annex 1 defines lines of business for SLT and NSLT health in such way, that:

- NSLT is split into "income protection", "medical expenses", "workers' compensation" and "non-proportional health reinsurance" (lines of business (LoBs) 1-3, resp. 13-15 and 25)

- SLT is not split further into income protection / medical expense, only reinsurance and annuities are separated (LoBs 29, 33, 35)

For further simplification, we would like to focus on most common insurance obligations – NSLT LoBs 1-2 and SLT LoB 29.

Article 163 DR specifies the calculation of loss for pandemic risk. According to our interpretation the first part of the formula (0,000075 * E) applies only to income protection exposures, and the second part of the formula (0,4 * Sum_c (Nc * Mc)) applies only to medical expense exposures.

We would like to clarify how this should be applied to SLT health insurance obligations (LoB 29), which is neither income protection nor medical expenses in our understanding. Is LoB 29 excluded from the calculation? Or should we split LoB 29 further into income protection / medical expenses, even if it is not required for any other purposes (reporting etc.)?

Guidelines on health catastrophe risk sub-module (EIOPA-BoS-14/176) also do not clarify this issue.