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FSC GIMAP PAQC template

By George Bryant,2014-12-17 19:16
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FSC GIMAP PAQC template

    Solvency 2 Gibraltar Internal Model

    Approval Process (GIMAP)

    Pre-application qualifying criteria

    assessment template

Firm name

    Date of completion

    Firm contact details

     1

Contents

    1. Solvency 2 implementation plan ................................................................................................. 6 2. Plans to iteratively develop your internal model .......................................................................... 7 3. Documentation of the model....................................................................................................... 8 4 Completion of QIS5 .................................................................................................................. 10 5 Sign-off .................................................................................................................................... 11

     2

Introduction

    This document is intended solely and exclusively for use in our pre-application process, which forms part of our plans for the implementation of the Solvency 2 Directive (“The

    Directive”). The directive requirements on firms are expected to take effect from the end of 2012.

This document should be read in conjunction with „Final CEIOPS level 3 guidance on

    Solvency 2 - Pre-application process for internal models‟ (CEIOPS-DOC-76/10) issued in

    March 2010.

    CEIOPS have proposed that criteria for resource allocation be used to ensure that the resources of supervisory authorities are used as efficiently and effectively as possible. The

    pre-application qualifying criteria set out in this paper are based on and consistent with the Criteria for Resource Allocation introduced by CEIOPS in Level 3 guidance on Solvency 2:

    Pre-application process for internal models (CEIOPS-DOC-76/10).

    The overall requirement for firms starting the pre-application process is that they are making good progress towards implementation of Solvency 2. Firms will need to demonstrate their progress by providing evidence that they have:

    ; an approved Solvency 2 implementation plan;

    ; plans to iteratively develop the internal model;

    ; an index and summary of the draft documentation of the model; and

    ; completed QIS5.

    As a firm that has indicated it would like to start the pre-application, you are asked to complete this template. You should answer the questions based on your current preparation for starting the pre-application phase of the internal model approval process.

     1The template should be completed with respect to all financial undertakings that will be

    covered by the internal model and which the FSC will have to consider as part of the approval process. In the case of insurance groups where the FSC is not the EEA lead regulator this would include all UK financial undertakings that are planned to be captured within the scope of the group internal model or for which an individual solo application will be submitted.

    To avoid the need for excessive follow-up meetings, we have designed this document to be reasonably self-contained. We have no expectation as to the length of the completed document, but we expect firms to have given proper consideration to each question.

    We reserve the right to review documentation and other sources referred to in your answers.

Next steps

    Please send your signed and completed pre-application qualifying criteria assessment template (the assessment template) to your FSC contact person at least one month before

    your intended start date for the pre-application.

     1 A financial undertaking as defined in Article 13 (25) of the Directive includes insurance, or reinsurance undertakings, insurance holding companies, special purpose vehicle assuming risks from insurance or reinsurance undertakings, mixed financial holding companies, investment firms, and credit institution. For the purposes of this document the term financial undertaking should also be presumed to include mixed-activity insurance holding companies as defined in Article 212 (1)g of the Directive.

     3

    We will review the submission and notify firms of our decision within one month of receipt. If it is not possible to make a decision and notify the firm within the indicated timeframe, then we will write to the firm and give a precise date by which they will receive a response.

The decision will typically take one of the following three forms:

The firm may start pre-application on the scheduled date.

     The firm may start pre-application on the scheduled date, subject to completion of

     further work before that date.

     The firm may start pre-application at a later specified date than the original

     scheduled date, subject to re-submission and re-assessment of the pre-application

     qualifying criteria template after additional work has been completed.

     4

Reference material

     2In addition to the Directive, firms may also find the following documents useful, as they provide further detailed guidance relevant to the application for approval of an internal model.

Paper Issued Description

    Final CEIOPS Nov 09 Sets out the systems of governance to be maintained by all advice for level 2 firms, whether they have an approved internal model or not. The implementation paper also goes into detail about the various functions within the measures on insurer, such as the risk management function, the actuarial Solvency 2 function and the internal audit function.

    System of

    governance

    (CEIOPS-DOC-

    29/09)

    Final CEIOPS Nov 09 General provisions for the internal model approval process, advice for level 2 including some specificities related to partial internal models.

    implementation There are also details on how the approval process would work measures on for groups. It considers the same stages as the approval process

    Solvency 2 for solo entities, i.e. pre-application, application, assessment, The procedure to decision. This paper lists some further items that would be be followed for the required for a group model, especially with regard to the scope of approval of an the model.

    internal model

    including the

    addendum on

    group specificities

    (CEIOPS-DOC-

    28/09)

    Final CEIOPS Nov 09 Sets out the requirements for Articles 120 to 126, specifically the:

    advice for level 2 use test