ARTICLE
6 October 2016

Insurance Regulatory Update - September 2016

AC
Arthur Cox

Contributor

Arthur Cox is one of Ireland’s leading law firms. For almost 100 years, we have been at the forefront of developments in the legal profession in Ireland. Our practice encompasses all aspects of corporate and business law. The firm has offices in Dublin, Belfast, London, New York and Silicon Valley.
The implementation of Solvency II remains a focus for the Central Bank but it also highlights issues such as the post-Brexit landscape, cyber risk exposure and the continuing low interest rate environment.
Ireland Insurance
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SEPTEMBER 2016 – THIS MONTH'S NEWS

  • CENTRAL BANK PUBLISHES INSURANCE QUARTERLY NEWSLETTER
  • CENTRAL BANK PUBLISHES INSURANCE STATISTICS 2015
  • CENTRAL BANK GUIDANCE ON IT AND CYBERSECURITY RISKS
  • CENTRAL BANK PUBLISHES INTERMEDIARY TIMES
  • INSURANCE IRELAND MAKE A STATEMENT ON THE IMF REPORT ON THE IRISH INSURANCE SECTOR
  • CCPC INVESTIGATES MOTOR INSURANCE SECTOR
  • EUROPEAN PARLIAMENT REJECTS COMMISSION DELEGATED REGULATION SUPPLEMENTING THE PRIIPS REGULATON
  • EIOPA PUBLIC HEARING ON THE INSURANCE DISTRIBUTION DIRECTIVE
  • EOIPA HOSTED ONLINE SURVEY ON GUIDELINES FOR ASSESSMENT OF COMPLEX IBIPS
  • IMPLEMENTING REGULATION PUBLISHED IN OJ ON ITS REGARDING PROCEEDURES FOR APPLICATION OF TRANSITIONAL MEASURE FOR EQUITY RISK SUB-MODULE UNDER SOLVENCY II
  • EIOPA SPEECH ON THE WAY FORWARD WITH SOLVENCY II IMPLEMENTATION
  • EIOPA CHAIRMAN MAKES STATEMENT TO ECON
  • INSURANCE EUROPE RESPONDS TO OECD CONSULTATION ON THE ATTRIBUTION OF PROFITS TO PERMANENT ESTABLISHMENTS
  • INSURANCE EUROPE LAUNCHES DIGITALISATION SHOWCASE
  • TREASURY SELECT COMMITTEE LAUNCHES INQUIRY INTO EU INSURANCE REGULATION

IN DOMESTIC NEWS...

CENTRAL BANK PUBLISHES INSURANCE QUARTERLY NEWSLETTER

On 21 September, the Central Bank published issue 2 of Insurance Quarterly. This edition of the newsletter covers regulatory developments at a European and domestic level since June 2016. The implementation of Solvency II remains a focus for the Central Bank but it also highlights issues such as the post-Brexit landscape, cyber risk exposure and the continuing low interest rate environment.

(Re)insurers are reminded that the Central Bank is hosting an industry briefing event for CEOs and senior executives of insurance undertakings on Wednesday 26 October 2016.

Earlier this year the Central Bank introduced a new supervisory framework for engagement with low impact companies which included the Central Bank carrying out a number of inspections of these firms. The Central Bank's experience to date shows that many of the firms' outsourcing agreements were not fully compliant with Solvency II legislation; risk management policies were not detailed enough to cover the complexity of the undertakings; and many of the identified risks in own risk and solvency assessments were not subjected to a sufficiently wide range of stress tests or scenarios analyses.

A reporting update is also provided on NST Taxonomy, EIOPA Annual Returns; NST Bi-annual Returns; and EIOPA's publication of a hotfix of the Taxonomy 2.1.0.

A link to the newsletter is here.

CENTRAL BANK PUBLISHES INSURANCE STATISTICS 2015

On 26 September, the Central Bank of Ireland published insurance industry statistics for 2015. The publication provides a summary of the life and non-life insurance returns made to the Central Bank of Ireland in respect of business written during the year ending 31 December 2015.

The document contains tables of statistical data for life assurance, non-life insurance and Lloyds syndicates established in Ireland. The life assurance tables provide figures for the gross new life assurance business written in Ireland for 2015, net figures for life and industrial assurance business and a summary of the reinsurance of Irish life and industrial assurance. Total Irish life head office business for the year 2015 increased, with the premium income stated to be €32,685,757. Comparative tables for the years 2007 – 2015 are also provided.

Non-life tables are provided for Irish and foreign risks broken down by class. The balance sheet totals for non-life insurance business for the year 2015 puts total assets at €35,104,980.

A link to the publication is here.

CENTRAL BANK GUIDANCE ON IT AND CYBERSECURITY RISKS

On 13 September, the Central Bank issued a guidance document entitled "Cross Industry Guidance in respect of Information Technology and Cybersecurity Risks". The Central Bank highlights the role of IT as being at the heart of the supply of financial services. The Central Bank states that firms should assume they will be successfully targeted by hackers based on the increase in incidences of cyber-attack and business interruption.

The Central Bank has outlined in the guidance a number of key issues in this area which firms must robustly address including: alignment of IT and business strategy; outsourcing risk; change management; cybersecurity; incident response; disaster recovery and business continuity. The Central Bank highlights that "sufficient resources" will need to be allocated to improve the security and resilience of IT systems as well as their governance and management. The Central Bank expects Boards and Senior Management of firms to take responsibility for these issues and prioritise them. Given the potential impact of the risks involved the Central Bank will be assessing firms' knowledge, understanding and effective management of IT-related risks as part of their supervisory engagement.

A link to the guidance document is here.

To view the full article please click here.

This article contains a general summary of developments and is not a complete or definitive statement of the law. Specific legal advice should be obtained where appropriate.

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