The CRO Forum companies have developed internal capital models, which they expect to be approved by the regulators as a basis for setting the level of target capital ('SCR'). The CRO Forum companies have also participated in QIS3.
We have been an active participant in the Solvency II discussions that have taken place before the publication of the Solvency II directive promoting a risk-based and economic approach. We have therefore published a number of own initiatives papers on issues covering the cost of capital approach to market value margin (MVM), diversification benefits, internal models and financial risk mitigation and has responded to CEIOPS consultation papers.
CRO Forum comments on Consultation Paper no. 20 "Pillar I issues - further advice" We welcome the opportunity to comment on this draft advice. The CRO Forum believes that the issues covered by this Consultations paper are key for the future solvency regulation. In this regard, the CRO Forum welcomes this Consultation paper, which develops further some of the points already discussed in the previous calls for advice. Since then, we believe that the QIS II exercise provided with a lot of useful information and feedback from the industry, and also that the political guidelines from the European Commission have been specified on a number of issues.
CRO Forum comments on Consultation Paper no. 16 "Pillar II issues relevant for reinsurance"
CRO Forum's response to CEIOPS Consultation Paper no. 17: draft advice to the European Commission in the framework of the Solvency II project on Pillar 2 capital add-ons for solo and group undertakings We welcome this Consultation Paper from CEIOPS. The CRO Forum supports the inclusion of powers for a capital add-on in the Solvency II framework directive. However, we must emphasise that capital add-ons should be seen as a last resort as expressed, for example, in article 136(2) of the EU's Capital Requirements Directive.
CRO Forum comments on Draft advice on Consultation Paper no. 19 "Safety measures (Limits on Assets)" The CRO Forum appreciates CEIOPS' further development of principles for the formulation and application of the supervisory tool 'Pillar II capital add-on', and welcomes the opportunity to comment on this draft advice.
We welcome this discussion document from the FSA and HMT which contains very useful principles for prudential supervision of groups in Solvency II.
While the exercise has highlighted a number of areas which require further consideration and discussion, the CRO Forum believes CEIOPS has achieved an important step in providing this new basis for discussion.
This presentation is based upon the consolidated responses of the Chief Risk Officer Forum and Comité Européen des Assurancesto CEIOPS-CP-03/06, "Draft Advice to the European Commission in the framework of the Solvency II project on subgroup supervisions, diversification effects, cooperation with third countries and issues related to the MCR and SCR in a group context."
The Chief Risk Officer Forum ('CRO Forum') comprises risk officers of the major European insurance companies and financial conglomerates, and was formed to address the key relevant risk issues. It is a technical group focused on developing and promoting industry best practices in risk management.