EIOPA Solvency II Reporting Changes – 31/12/2023
EIOPA are introducing their new reporting taxonomy – Version 2.8.0 – which will take effect for reporting from the 31st December 2023. The new taxonomy sees the first significant changes to the reporting templates since the introduction of Solvency II in 2016. Below we have summarised the main changes to the reporting templates. The full official documentation, including annotated templates and revised implementing regulations is published on the EIOPA web site:
The final templates and log files are available in the “Business Package” which can be downloaded from the web site here:
Template Deletions
The following templates are being deleted from the reporting package:
- S.03.02 / S.03.03 – the list of off-balance sheet unlimited guarantees information will be deleted.
- S.04.01 – Activity by Country template will be replaced with a new set of activity by country templates.
- S.05.02 – Premiums, Claims and Expenses by Country is incorporated into the replacement S.04 templates for solo entities and third country branches.
- S.06.01 – the annual summary version of the assets reporting template will be deleted – the fully detailed S.06.02 version will continue with a few additional fields.
- S.08.02 – the derivative transactions template will be removed from both annual and quarterly reporting.
- S.15.01 / S.15.02 – the variable annuity reporting templates will be deleted.
- S.25.02 / S.25.03 – the partial and full internal SCR reporting templates will be replaced with a new template (S.25.05).
Template Additions
- S.04.03 / S.04.04 / S.04.05 – these new templates replace the S.04.01 Activity by County template. S.04.03 will list out all of the key underwriting entities. The by country reporting will be split according to the location of the underwriting on S.04.04 and then by the location of the risk on S.04.05.
- S.06.04 –Climate change-relate risks to investments –an area of increasing importance to the regulators and this new template captures information on this subject.
- S.14.02 - Non-Life Obligation Analysis – the policy analysis already conducted by life companies on S.14.01 is now being extended to Non-life companies via this template.
- S.14.03 – Cyber Underwriting Risk – another evolving area the regulators are keen to monitor.
- S.14.04 / S.14.05 – (Financial Stability Reporting only) Liquidity Risk analysis for Life and Non-life companies respectively.
- S.23.04 (Group Reporting) not a new template – but there are significant revisions and additional lines added into this template for Group Reporting.
- S.25.04 – (Financial Stability Reporting only) adding the SCR calculation to the FSR reporting submissions
- S.25.05 – reporting internal model information for firms using either a partial or full model (replacing the S.25.02 / S.25.03 templates)
- S.26.08 – S.26.16 – Internal Model Risk Module reporting. Several national regulators have imposed their own NSTs to collect this information over the years and these templates are an attempt by EIOPA to produce a standard set of EEA-wide templates for reporting internal model SCR calculations. It is possible some NST reporting may be relaxed as a result of this addition.
- S.37.02 / S.37.03 for group reporting the Risk Concentration templates are expanded to cover exposures by currency, sector and country and also by asset class and rating.
In addition, many templates have been revised and amended, there are also changes to some of the reporting thresholds as well which may reduce the reporting requirements for smaller firms.
A copy of the template matrix comparing the current reporting templates to the new ones can be downloaded here.
Version 9 Preview
To help with your preparations for these reporting changes, a preview version of the software is available to download from the web site. This will allow you to set up a workbook in the new format which you can start work on. While the templates are now final, the validation testing and output functionality will be added into the software in the autumn, which should be in time to assist with any UAT testing opportunities which the regulators may offer.
Bank of England PRA Regulatory Changes (UK-only)
In the UK HM Treasury and the PRA have been undertaking their reviews of the Solvency II reporting regime and how this might be developed following the UK’s withdrawal from the EU. There have been two stages to the review – Phase 1 concentrated on a small number of templates which could simply be deleted from the UK’s requirements, along with a more generous criteria for issuing quarterly reporting waivers. Phase 2 looks at what the changes to the design of the reporting templates could be made to improve the reporting in the UK. The latest proposals have now been published, and the intention is that this revised regime will be applied from 31st December 2024 (a year after the EIOPA changes). It is worth noting that the PRA aspire to merge the QRTs with their own NSTs to create one combined set of templates. The expectation is that the templates will all be renamed – so no longer using the EIOPA “S.00.00” format, although there is no indication as to what this format will look like. For the moment, the template names remain the same for retained templates, and with additional place holder names added in for the new ones. Full details of the latest consultation are published on their web site:
The deadline for submitting feedback is the 1st September 2023. The current proposals are as follows:
Template Deletions
The following templates are being deleted from the reporting package:
- S.04.01 / S.04.02 – Activity by Country templates will be removed. Since FPS [passporting] is no longer an issue in the UK – the importance of these templates is reduced. Country reporting will be collected on the S.05.02 and new S.05.04 templates going forward.
- S.05.01 – the Premiums, Claims and Expenses data templates will be replaced with a modified version of NS.07 for non-life firms, while life companies will use the new S.05.03
- S.06.01* – the summary version of the Assets Templates – which is occasionally used for annual reporting, is being deleted. (The full S.06.02 assets sheet will be retained however and there are no changes to the content or frequency of reporting this template).
- S.07.01 – structured products sheet has been deleted
- S.08.02 – the derivative transactions template will be removed from both annual and quarterly reporting.
- S.15.01 / S.15.02* – the variable annuity reporting templates will be deleted.
- S.12.02 + S.17.02 – Life + Non-Life Technical Provisions breakdown by country
- S.21.01 + S.21.03 – Loss distribution risk profile and distribution of non-life underwriting risks
- S.22.05 / S22.06 – Calculation of transitional on technical provisions and best estimate subject to volatility adjustment
- S.25.01 / S.25.02 / S.25.03 – SCR Calculation Templates for firms using the standard formula / partial internal model / full internal model respectively
- S.28.01/2* MCR Templates – will be removed from quarterly reporting for all firms.
- S.29.01–S.29.04* – the Variance Analysis templates which were introduced a couple of years ago will be deleted
- S.30.01 / S.30.02 – Facultative Reinsurance arrangements for life and non-life business
- S.31.02 – Special Purpose Vehicles
- S.36.03 – IGT – Internal Reinsurance
- Financial Stability Reporting (S.36.01 – S.41.01)* the additional templates for the ECB which only a handful of the largest UK insurers reported will be deleted.
- NS.05 – Revenue Account (Life)
- NS.06 – Business Model Analysis (Life)
*Templates already removed from UK reporting requirements since 31/12/2021.
Some changes will be made to the thresholds for reporting S.16.01 (annuities stemming from non-life insurance).
Template Additions
- S.01.04 – New basic information sheet for third-country branches •- NS.07 – the template has been revised to enable it to replace S.05.01 for non-life firms and there is a new reduced version intended for quarterly reporting
- S.05.03 – Revenue Account (Life) – summary quarterly submission with more detail required from solo and branches on an annual basis. This will also be reported for Ring Fenced Funds
- S.05.04 – Activity by Country – annual submission for solo and branch returns.
- S.14.02 – Non-Life Obligation Analysis – the policy analysis already conducted by life companies on S.14.01 is now being extended to Non-life companies via this template. (similar to the EIOPA changes).
- S.14.03 - Cyber Underwriting Risk (similar to the EIOPA changes).
- NS.14 – Excess Capital Generation – a new annual template being added to the Technical Provisions reporting.
- S.22.07 – Best Estimate subject to volatility adjustment by currency.
- S.25.04 new SCR Calculation templates replacing S.25.01 - S.25.03
- S.25.05 additional SCR Calculation template for firms using internal models (partial or full).
- S.25.06 – new SCR template reporting the loss absorbing capacity of deferred taxes.
- S.30.03 and S.30.04 have been modified to report Non-life reinsurance business only (which now includes the facultative reinsurance reporting formerly found on deleted templates S.30.01 and S.30.02). New templates S.30.06 to S.30.08 have been added for Life reinsurance business. New template S.30.05 collects all the information on reinsurers into one table.
Again many of the templates have there are further changes made to them. A copy of the template matrix comparing the current reporting templates to the new ones can be downloaded here.
Version 10 Preview
We will be releasing a preview version of the software (Version 10) on the web site shortly. The preview will enable you to run through the set up process and create the relevant templates for your business based on the latest proposals. Validation testing and XBRL output will become introduced after the final specs are determined by the PRA.