The Central Bank of Ireland (Central Bank) recently published its first Insurance Newsletter (Newsletter) of 2021. Topics covered include:
- Sustainable insurance.
- The Temporary Run-Off Regime for UK/Gibraltar firms (TRR).
- The Central Bank's draft Cross-Industry Guidance on Outsourcing (Guidance) and its associated consultation paper (CP 138).
- The consultation paper on enhancing Central Bank engagement with stakeholders (CP 136).
The Newsletter also includes updates to the industry from the Central Bank and EIOPA.
The Newsletter contains a section dedicated to sustainable finance developments and the impacts for the (re)insurance industry. The Central Bank highlights the work of the United Nations convened Sustainable Insurance Forum, EIOPA's sensitivity analysis of climate-related "transition risks" for (re)insurers in particular in their investment portfolio and the potential financial impacts for (re)insurers. The Newsletter also outlines the European Commission's new "EU Strategy on Adaptation to Climate Change", which focuses on building a climate-resilient society in the European Union by 2050.
Temporary Run-Off Regime
The TRR, which provides that UK and Gibraltar insurance undertakings and insurance intermediaries must terminate their activities in Ireland in an orderly fashion, has been in operation since 1 January 2021. The Central Bank notes that, under the TRR, relevant undertakings must have ceased to conduct new insurance contracts on or before 31 December 2020. The Newsletter reminds relevant undertakings that applications to avail of the TRR must be made by 31 March 2021. Our briefing on the TRR is available here.
Draft Cross-Industry Guidance on Outsourcing and Consultation Paper 138
On 25 February 2021, the Guidance and CP 138 were published by the Central Bank. The Central Bank notes that the Guidance aims to assist regulated firms in developing their outsourcing risk management framework, thereby enabling firms to identify effectively, monitor and manage outsourcing risks. The Newsletter highlights that the Guidance reminds regulated firms of their statutory obligations concerning compliance regarding existing and future legislation, regulations, and guidelines in respect of the management of outsourcing risk.
The consultation period for CP 138 will end on 26 July 2021.
CP 136 – Consultation Paper on Enhancing Central Bank Engagement with Stakeholders
The Newsletter encourages stakeholders to respond to the Central Bank's recent consultation paper, CP 136. Our briefing on this consultation paper is available here. The deadline for submissions in response to CP 136 is 11 May 2021.
The Newsletter includes various other updates from the Central Bank, including updates on:
- The Central Bank's new portal, which enables authorised users to upload and view information relating to the RFSP.
- Business Interruption.
- The Central Bank's fifth annual Demographic Analysis Report.
- EIOPA's studies on Internal Models relating to (i) Diversification, (ii) Market and Credit Risk, and (iii) Non-Life Underwriting Risk.
Originally Published by William Fry, March 2021
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