IVASS: public consultation on proposed amendments to IVASS Regulation no. 18 of 15 March 2016

IVASS Regulation no. 18 of 15 March 2016

IVASS has initiated the  public consultation procedure with regard to the some proposed amendments to IVASS Regulation no. 18 of 15 March 2016 concerning the rules for the determination of technical provisions referred to in Article 36-bis of the Private Insurance Code.The purpose of the amendments is to align the national rules with the EIOPA Guidelines of  July 6, 2022 on the valuation of technical provisions and the determination of contractual limits.

The EIOPA Guidelines, applicable as from January 2023, are contained in two seperate documents:

  1. Document on the determination of technical reserves, containing guidelines with which:
    • the need to take into account the principle of proportionality (under Solvency II) with regard to the nature, scale and complexity of the risks assumed by insurance undertakings is emphasised;
    • has been clarified that the undertakings are required to assess the relevance and impact of the assumptions used in the calculation of technical provisions,;
    • criteria for the modelling of biometric risk factors; for the identification of investment management expenses to be used in the calculation of the best estimate; for the determination of a dynamic client behaviour model; for the choice of the valuation model for contractual options and financial guarantees and for the identification of risk factors to be taken into account in the calibration process of economic scenario generators have been introduced. Furthermore, measures for planning “future management measures” and for calculating the expected profits included in future premiums (‘EPIFP’) have been identified.
  2. Document on the identification of contractual limits, containing indications on the recognition of insurance obligations and calculation of technical provisions, with reference to:
    • definition of the “contractual limit”;
    • setting of new operational rules for the breakdown of the insurance contract;
    • determination of the impact of a financial guarantee and an uncertain event;
    • definition of rules for the review and revision of contractual limits.

The consultation period ends on February 18, 2022.