Solvency ii Training and Certification from the Solvency ii Association

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Solvency ii Training and Presentations

from the Solvency ii Association

the largest Association of Solvency ii Professionals in the world

1st Certified Course: For the implementation of the Solvency ii Directive

in the countries of the European Economic Area

Course Title

Preparing for the Solvency ii Directive of the EU

(3 days)

Objectives:

This course has been designed to provide with the knowledge and skills needed to understand and support compliance with the Solvency ii Directive of the European Union.

Target Audience:

This course is intended for managers, professionals and consultants that want to understand the Solvency ii requirements and work in Solvency ii compliance projects.

This course is recommended for senior managers and executives involved in risk and compliance.

About the Course

INTRODUCTION

· The European Union’s Legislative Process. Directives and Regulations

· The Financial Services Action Plan (FSAP) of the EU

· Solvency ii and the Lamfalussy Process

· Level 1: Framework Principles

· Level 2: Implementation of Principles. Detailed Technical Measures

· Level 3: Strengthening Cooperation Among Regulators

· Level 4: Enforcement

· Overview of the Solvency I framework

· From Solvency I to Solvency II

· Solvency II Key Players

· Committee of European Insurance and Occupational Pension Supervisors (CEIOPS)

· European Insurance and Pension Committee (EIOPC)

· CEA (Comité Européen des Assurances) - the European Insurance and Reinsurance Federation.

· The International Association of Insurance Supervisors (IAIS)

OVERVIEW OF THE SOLVENCY II DIRECTIVE

· Solvency ii: An Overview

· A Risk Based Approach

· A Unified Legislative Basis for Prudential Regulation of Insurers and Reinsurers

· Risk-Based Capital Allocation

· Pillar 1: The Financial Resources Needed to be Considered Solvent

· The Solvency Capital Requirement (SCR)

· The Standard Approach

· The Internal Model

· The Collection of Additional Historical Data

· External Data

· The IT Challenge

· The Minimum Capital Requirement (MCR)

· Pillar 2 and the Supervisory Review Process

· Own Risk and Solvency Assessment (ORSA)

· ORSA as an internal assessment process

· ORSA as a supervisory tool

· The role of the ORSA - not a third solvency capital requirement

· Pillar 3 and the Disclosure Requirements

· Solvency and Financial Condition Report

THE SOLVENCY II DIRECTIVE

· Scope of the Application

· Authorisation

· Discussing some important definitions

· General principles of supervision

· Home vs. Host country

· Information to be provided for supervisory purposes

· Capital Add-on

· System of Governance

· General Governance Requirements

· Risk Management

· Internal Controls

· Internal Audit

· Actuarial Function

· Outsourcing

· Own Risk and Solvency Assessment

· Own Risk and Solvency Assessment and CEIOPS

· Public Disclosure

· Professional Secrecy and Exchanges of Information

· Agreement with Third Countries

· Rules Relating to the Valuation of Assets and Liabilities, Technical Provisions, Own Funds, Solvency Capital Requirement, Minimum Capital Requirement and Investment Rules

· Valuation of Assets and Liabilities

· Calculation of Technical Provisions

· Recoverables from Reinsurance Contracts and Special Purpose Vehicles

· Own Funds

· Determination, Classification, Eligibility of Own Funds

· Solvency Capital Requirement

· Requirement Using the Standard Formula or an Internal Model

· Value-at-Risk

· The SCR and the Value-at-Risk Measure Calibrated to a 99.5% Confidence Level over a 1-year Time Horizon.

· Calculation of the Solvency Capital Requirement

· Structure of the Standard Formula

· Design of the Basic Solvency Capital Requirement

· Capital requirement for operational risk

· Full and Partial Internal Models

· Calculation of the Minimum Capital Requirement

· Insurance and Reinsurance Undertakings in Difficulty or in an Irregular Situation

· Identification and Notification of Deteriorating Financial Conditions by the Insurance and Reinsurance Undertaking

· Non-Compliance with the Solvency Capital Requirement

· Non-Compliance with the Minimum Capital Requirement

· Supervisory Powers in Deteriorating Financial Conditions

· Withdrawal of authorisation

· Right of Establishment and Freedom to Provide Services

· Conditions for Branch Establishment

· Branches Established Within the Community and Belonging to Insurance or Reinsurance Undertakings whose Head Offices are Outside the Community

· Principles and Conditions of Authorisation

· Equivalence

· Subsidiaries of Insurance and Reinsurance Undertakings Governed by the Laws of a Third Country and Acquisitions of Holdings by such Undertakings

· Third-Country Treatment of Community Insurance and Reinsurance Undertakings

· Supervision of Insurance and Reinsurance Undertakings in a Group

· Group Supervision: Definitions, Cases of Application, Scope and Levels

· Supervision of Group Solvency

· Choice of Calculation Method and General Principles

· Choice of Method

· Related Insurance and Reinsurance Undertakings

· Intermediate Insurance Holding Companies

· Related Third-Country Insurance and Reinsurance Undertakings

· Related Credit Institutions, Investment Firms and Financial Institutions

· Calculation methods

· Method 1 (Default method): Accounting Consolidation-Based Method

· Group Internal Model

· Method 2 (Alternative Method): Deduction and Aggregation

· Third countries

· Parent Undertakings Outside the Community - Verification of Equivalence

· Parent Undertakings Outside the Community - Absence of Equivalence

· Parent Undertakings Outside the Community - Levels

· Cooperation with Third Countries Supervisory Authorities

THE REINSURANCE DIRECTIVE

· Directive 2005/68/EC of 16 November 2005 on Reinsurance

· Reinsurance, Captive Reinsurance Undertakings, Finite Reinsurance

· Authorisation

· Principles and Methods of Financial Supervision

· Supervision of Branches Established in Another Member State

· Special Purpose Vehicles

· Third Countries

· Transposition

THE SOLVENCY II DIRECTIVE AND THE NON-EEA COUNTRIES

· Solvency ii, the Reinsurance Directive and Countries of the European Economic Area and outside the European Economic Area

CLOSING

· The Impact of Solvency ii

· Translating Complex Rules Into Daily Activities

· Comparing and Contrasting Basel II and Solvency II

· The Differences

· What is next

The Level 2 - Technical measures
Solvency ii: A risk that can become an opportunity

2nd Certified Course: For the implementation of the Solvency ii Directive

in the countries outside the European Economic Area

“The treatment of third-country groups under the proposed Solvency II legislation is a problem for US-based insurers who write business in the EEA:

- Under the proposal the US-held capital and the diversification benefit of US groups’ worldwide business, including their US-operations, will not be taken into account in the solvency calculations of their EEA operations unless the US supervisory system is recognised as “equivalent” under Solvency II

This means that the cost of capital for US-based insurers will be higher than that of EEA-based groups, resulting in a nonlevel playing field, making US insurers in the EEA less competitive.

- Under the proposed legislation, a European group supervisor will have the right to oblige a US group to set up an EEA-insurance holding company, to facilitate groupwide supervision of the EEA business. This could be very costly for the business, further affecting the ability of these groups to compete.”

Position Paper on Solvency II

The American Chamber of Commerce to the European Union (AmCham EU), February 12th 2008

“The International Association of Insurance Supervisors (IAIS) expects that the new supervisory scheme will provide useful input to IAIS solvency initiatives as it will be applied by a large number of insurance supervisors within the European Union.

It will inspire supervisors to rethink the way in which transnational supervision is organised”

Michel Flamée, Chair of the IAIS Executive Committee

Established in 1994, the IAIS represents insurance regulators and supervisors of some 190 jurisdictions

in nearly 140 countries.

Course Title

Preparing for Equivalence with the Solvency ii Directive of the European Union

Understanding the Solvency ii directive of the EU and the extraterritorial application to non-EU countries.

(3 days)

Objectives:

This course has been designed to provide with the knowledge and skills needed to understand the Solvency ii and the Reinsurance directives of the EU, and their extraterritorial application to non-EU countries.

Target Audience:

Many non-EEA countries have announced significant enhancements to their solvency and disclosure regulations for insurance, to achieve recognition as having equivalent regulatory standards to those in Europe’s Solvency II Directive.

This course is intended for managers, professionals and consultants working in countries outside the EEA, that want to understand the Solvency ii Equivalence requirements.

This course is intended for managers, professionals and consultants working in groups whose parent is located in a third country, providing insurance services in the EEA (their EEA subsidiaries meet the requirements imposed by Solvency II).