Ireland: Insurance Quarterly Legislative Update 1 April 2017 - 30 June 2017

Last Updated: 25 July 2017
Article by Dillon Eustace

Most Read Contributor in Ireland, July 2017


Solvency II

(i) EIOPA releases methodology and calculations for the ultimate forward rate under Solvency II

On 5 April 2017, EIOPA published a number of documents relating to the methodology and calculations for the ultimate forward rate (the "UFR"), the principles of which are defined in the Solvency II legislation. The UFR Methodology will be applied for the first time in the calculation of the risk-free interest rates of January 2018. The methodology is a result of extensive work and the documents published include the following:

Specification of the methodology to derive the UFR: This sets out information on updates to the UFR. EIOPA will annually calculate the UFRs and, where they are sufficiently different according to the methodology from the then applicable UFRs, EIOPA will update them at the beginning of the next year. The updated UFRs will be announced every year by the end of March. Nine months after the announcement of the updated UFRs, EIOPA will use them to calculate the risk-free interest rate term structures for the term structures of 1 January of the following year.

A copy of the specification of the methodology may be accessed here.

Calculation of the UFR for 2018: This sets out information on the calculation of the UFR, which is for the first time applicable for the calculation of the risk-free interest rates of 1 January 2018, including the calculation of the expected real rate, the expected inflation rate, the calculated UFRs and the UFRs applicable in 2018 and information on the projection of the UFR. It must be noted that an updated version of this document was published on 23 May 2017 (dated 17 May 2017) to correct the applicable UFR for the Mexican Peso on page 3.

A copy of the calculation of the UFR for 2018 can be accessed here.

Results of the impact analysis of changes to the UFR: This document sets out the results of the information request to (re)insurance undertakings that EIOPA carried out at the end of 2016 assessing the impact of changing the UFRs by 20 bps and by 50 bps on their prudential balance sheet and on their solvency position. The information request showed that the impact of these changes is very small.

The results of the impact analysis of changes to the UFR can be accessed here.

FAQs on the UFR: EIOPA also published a set of FAQs on the UFR providing information on, amongst other things, why EIOPA suggested changing the UFR and what steps EIOPA took to derive the methodology.

A copy of the FAQs may be accessed here.

On 23 May 2017, EIOPA published its Final Report on consultation paper no 16/003 on the methodology to derive the UFR (the "Final Report"). EIOPA consulted on the methodology in April 2016 and section 2 of the Final Report includes a summary of the main comments received and EIOPA's resolution of these comments. In addition, the Final Report contains the final methodology to derive the UFR and how it will be implemented in section 3, the results of the information request to undertakings on the UFR in section 4 and a resolution table with all stakeholder comments in the Annex.

A copy of the Final Report can be accessed here.

(ii) EIOPA issues proposed amendments to Solvency II technical standards on reporting and disclosure

On 21 April 2017, EIOPA published a press release in which it announced that it identified some required amendments to the implementing technical standards ("ITS") on the templates for the submission of information to the supervisory authorities ("ITS on Reporting") and the ITS relating to the procedures, formats and templates of the solvency and financial condition report ("ITS on Disclosure") under Directive 2009/138/EC (the "Solvency II Directive").

In addition to the ITS, the proposed amendments also concern the EIOPA guidelines on reporting for financial stability purposes and the EIOPA guidelines on the supervision of branches of third-country insurance undertakings. Some of the amendments have an impact on the Solvency II XBRL Taxonomy, namely the governance of Taxonomy releases.

All interested parties were invited to comment on the proposed amendments or to submit possible further amendments by 8 May 2017. The full press release can be accessed here.

(iii) EIOPA publishes call for evidence on the treatment of unlisted equity and debt without external rating in the standard formula

On 26 April 2017, EIOPA published a call for evidence on the treatment of unlisted equity and debt without an external credit assessment institution ("ECAI") rating in the standard formula (the "Call for Evidence").

The Call for Evidence follows the Commission's second call for advice on the Commission Delegated Regulation (EU) 2015/35 (the "Solvency II Delegated Regulation") in February 2017 which related to the removal of unjustified constraints to financing. More specifically, the Commission requested advice in the areas of unrated debt, unlisted equities and strategic equity investments. Strategic equity investments are outside the scope of the Call for Evidence which focuses on unrated debt and unlisted equities.

In relation to unrated debt, EIOPA was asked to provide clear criteria for unrated debt to identify those instruments with a better risk profile as a first step in reducing over-reliance on external credit ratings for regulatory purposes.

In relation to unlisted equities, EIOPA was asked to provide clear criteria applicable to portfolios of unlisted equity from the European Economic Area ("EEA") to identify instruments that could benefit from the same risk factor as a listed equity.

The Call for Evidence contains a number of questions to stakeholders on these topics in order to allow stakeholders to provide their views and collect evidence. Comments on the Call for Evidence were due by 24 May 2017.

EIOPA will prepare draft advice to the Commission based on the feedback received and plans to consult on these proposals in November 2017. The Call for Evidence may be accessed here.

(iv) Central Bank publishes updated policy notice on reporting under Solvency II

In May 2017, the Central Bank published an update to its policy notice on the Options and Discretions on submission of information under Solvency II (the "Policy Notice"). The Policy Notice replaces the October 2015 policy notice and sets out the Central Bank's updated requirements and guidance in relation to the implementation of discretions and options relating to the submission of information arising under Solvency II.

The Policy Notice deals with the following:

Exemptions from Solvency II quarterly regulatory reporting: The Central Bank had previously exercised its discretion to exempt certain undertakings from the requirement to submit certain templates on a quarterly basis. Following a review of its position and given only a small number of firms benefited from this exemption, the Central Bank has decided that with effect from 1 January 2017 all undertakings and groups, for which the Central Bank is group supervisor, are required to submit all quarterly supervisory reporting due in accordance with the Solvency II requirements.

Solvency II Reporting Currency: Solvency II gives discretion to the Central Bank to require undertakings and groups to prepare their Solvency II supervisory reports in a currency other than that used to prepare their financial statements. The Central Bank has not exercised the discretion and therefore (re)insurance undertakings and those undertakings/companies at the head of a group supervised by the Central Bank, must prepare and submit their Solvency II supervisory reports in the currency used to prepare the statutory financial statements and/or consolidated financial statements.

Exchange Rates: Solvency II provides for a discretion to permit undertakings and groups to use a different exchange rate from that used to prepare their Solvency II financial statements for the purposes of Solvency II regular supervisory reporting. The Central Bank has not exercised this discretion and therefore (re)insurance undertakings and those undertakings/companies at the head of a group supervised by the Central Bank, must use the exchange rate used to prepare their Solvency II financial statements and/or consolidated financial statements for the purposes of Solvency II regular supervisory reporting.

The Policy Notice can be accessed here.

(v) Solvency II Commission Implementing Regulation (EU) 2017/812 published in the Official Journal of the EU

On 18 May 2017, Commission Implementing Regulation (EU) 2017/812 of 15 May 2017 laying down technical information for the calculation of technical provisions and basic own funds for reporting with reference dates from 31 March 2017 until 29 June 2017 in accordance with the Solvency II Directive (2009/138/EC) (the "Commission Implementing Regulation") was published in the Official Journal of the EU.

For prudential reasons, it is necessary for (re)insurance companies to use the same technical information for the calculation of technical provisions and basic own funds for reporting, irrespective of the date on which they report to their competent authorities. The Commission Implementing Regulation provides that (re)insurance companies must use the technical information on relevant risk-free interest rate term structures, fundamental spreads for the calculation of the matching adjustment and volatility adjustments referred to in Article 1(2) of the Commission Implementing Regulation when calculating technical provisions and basic own funds for reporting with reference dates from 31 March 2017 until 29 June 2017.

In order to ensure uniform conditions for the calculation of technical provisions and basic own funds by (re)insurance undertakings, this Commission Implementing Regulation states in the recitals that this technical information should be laid down for every reference date.

The Commission Implementing Regulation entered into force on 19 May 2017, applies from 31 March 2017 and is binding in its entirety and directly applicable in all Member States.

This Commission Implementing Regulation can be accessed here.

(vi) EIOPA publishes the 2.2.0 draft version of Solvency II XBRL Taxonomy

On 7 June 2017, EIOPA published the 2.2.0 working draft version of the Solvency II XBRL Taxonomy which is to be applied by insurance companies for reporting with the reference date of 31 December 2017.

XBRL (eXtensible Business Reporting Language) is an IT language for the electronic preparation, exchange and analysis of business information. Solvency II XBRL Taxonomy is a systematised description of all Solvency II reporting requirements. It was developed by EIOPA to ensure the harmonised XBRL reporting under Solvency II.

EIOPA invited comments on the updated version of the Solvency II XBRL Taxonomy before 30 June 2017 with a view to releasing the final 2.2.0 version in mid-July 2017.

The release notes for the draft 2.2.0 Solvency II XBRL Taxonomy can be found here.

To view the full article click here

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

In association with
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.