Tag Archives: QRTs

Analysis of Solvency and Financial Condition Reports for Irish life insurers

Solvency II came into effect on 1 January 2016 and introduced a number of disclosure requirements for European insurers. Under the new rules, European insurers are required to publish a Solvency and Financial Condition Report (SFCR). The third set of SFCRs contains a significant amount of information, including details on business performance, risk profile, balance sheet, and capital position. Insurers are also required to publish quantitative information in the public Quantitative Reporting Templates (QRTs) included within the SFCRs. This analysis by Milliman’s Matthew McIlvannaSinéad Clarke and Aisling Barrett highlights some interesting information published in the SFCRs of life insurance companies in Ireland at year-end 2018, focussing on premiums, investments and solvency coverage.

Solvency II reporting deadline calendar

The deadline for annual Solvency II reporting submissions will be two weeks earlier in 2020. The submission date is 7 April 2020. The deadline for the submission of the 2020 quarterly Quantitative Reporting Templates (QRTs) is unchanged from the equivalent deadline in 2019. This briefing note by Milliman’s Ellen Matthews and Sinéad Clarke provides a calendar highlighting key 2020 Solvency II deadlines.

Brief study of UK health insurers’ second SFCRs

This analysis by Milliman consultants compares information provided in Quantitative Reporting Templates (QRTs) and Solvency and Financial Condition Reports (SFCRs) and draws conclusions about the balance sheets and risk exposures of 15 UK private medical insurance and health cash plan providers. The analysis also highlights noteworthy trends between the 2017 and 2018 publications.

Solvency II reporting timeline

With Solvency II reporting becoming routine for companies, the focus now shifts to improving regulatory reporting processes and meeting the earlier deadlines.

This year, the deadline for submission of the 2019 quarterly quantitative reporting templates (QRTs) is a week earlier than the equivalent deadline in 2018 and the deadline for submission of the annual reporting requirements is two weeks earlier. In this briefing, Milliman’s Patrick Meghen and Ellen Matthews provide the timeline summarising the reporting requirements in 2019 for both solo entities and groups (assuming a year-end reporting date of December).

Brief study of UK health insurers’ first SFCRs

Solvency and Financial Condition Reports (SFCRs) contain a number of Quantitative Reporting Templates (QRTs). They are an important source of information on a company’s financial position under Solvency II. This report by Milliman’s Joanne Buckle and Didier Serre compares and contrasts the information in selected QRTs of 13 health insurers in the United Kingdom.

Central Bank shines a light on anomalies in Solvency II Pillar 3 reporting

This blog is part of the Pillar 3 Reporting series. For more blogs in this series click here.

The Central Bank of Ireland (CBI) held an industry workshop on 21 November aimed at practitioners who prepare the Quantitative Reporting Templates (QRTs) and, to a less extent, the Solvency and Financial Condition Report (SFCR). Despite the wet and wintry conditions, the session was very well attended and there was plenty of engagement from industry attendees. The CBI expressed concern regarding the level of errors in the Solvency II submissions, calling into question the processes, review and governance in place in (re)insurance companies.

This blog post outlines some of the highlights from the workshop:

• There has been a surprisingly high rate of resubmissions of quarterly and annual QRTs to date. For Q1 2016, it was as high as 70%. There is now a consistent resubmission rate at approximately 30%.

• The CBI pointed out that it commits significant resources to identifying and querying errors each quarter. In turn companies also spend time and effort remediating these issues. They see this as an unanticipated cost for both themselves and the industry.

• The most common errors relate to missing data on the list of assets template (S.06.02) and confusion around country classification for premiums, claims and expenses (templates S.04.01, S.05.01 and S.05.02).

• The CBI believes it has taken a pragmatic approach to QRT errors for the first 18 months of reporting, working with companies to remediate errors. However, it was clear that it would consider taking a harder line from next year onwards.

• The CBI specifically pointed to the Directors’ Accuracy Certificate, which relates to annual reporting only. In cases of persistent reporting errors by a company, the CBI intends to contact signing directors and may ask them to outline the governance and review processes in place.

• The CBI is carrying out some on-site inspections in relation to Solvency II reporting processes, with a particular focus on governance and review of submissions.

• In addition to the automatic cross-checks on the CBI’s Online Reporting System, it also outlined some of the additional quality assurance checks it carries out on receipt of QRTs. In order to assist companies in this regard, the CBI has prepared a spreadsheet with a list of these checks. It expects companies to build in these checks to their own processes before submitting templates.

• The CBI has also added an SFCR repository to its website. This contains the SFCR reports of insurance companies that are regulated by the CBI and is a useful resource for the industry. The CBI’s SFCR repository can be found here.

As such, a clear message has been sent to the industry regarding Pillar 3 reporting. The challenge will be in automating processes, streamlining review and tightening up the governance in this area.

I include links to both the slides from the industry workshop and the additional quality assurance checks spreadsheet.

Milliman STAR Solutions® – VEGA® is an automated Pillar 3 reporting and standard formula aggregation system. One of the key features of VEGA is inbuilt XBRL functionality and validations, ensuring the QRTs meet the CBI’s requirements before uploading to the Online Reporting System.