I agree We use cookies on this website to help us provide the best user experience. By browsing this site you agree to their use - more information is available here.

Barnett Waddingham
0333 11 11 222

Autumn data harvest

Published by Kim Durniat on

Amit Lad contributed to the writing of this blog

On 08 November 2013 the Prudential Regulation Authority (PRA) sent out a request to firms in the Internal Model Approval Process (IMAP) for data for the mid-year calculation of the Early Warning Indicators (EWIs)1.

What are EWIs?

One of the regulators concern is that, if not adequately monitored and updated, the solvency standard delivered by internal models can deteriorate over time. EWIs are a non-modelled cross check to ensure that internal models continue to meet the Solvency II calibration requirement (99.5% over a one-year time horizon).

The basic indicator that the regulator has opted for is the ratio between the Individual Capital Guidance (ICG) to the pre-corridor Minimum Capital Requirement (pMCR).

The idea behind EWIs is that they provide a warning so that firms and the regulator can take pre-emptive actions to ensure that their model is performing adequately.

What next?

If you have received a request from the PRA, then you need to submit the requested data by Tuesday 17 December. The PRA will add this to the data already collected and use to aid in the development, testing and refinement of EWIs.

1: Source: http://www.bankofengland.co.uk/pra/Pages/default.aspx

About the author

  • Kim Durniat

    Head of Life Consulting, Kim is responsible for managing the Life team, ensuring high quality, great value advice that meets client’s needs and developing our service offerings to the Life insurance sector.

    View Biography

Updates delivered to you

Stay ahead with our latest comment, expert insight and event details.