Commission Implementing Regulation (EU) 2023/894 of 4 April 2023 laying down implementing technical standards for the application of Directive 2009/138/EC of the European Parliament and the Council with regard to the templates for the submission by insurance and reinsurance undertakings to their supervisory authorities of information necessary for their supervision and repealing Implementing Regulation (EU) 2015/2450 (Text with EEA relevance)

S.12.02 – Life and Health SLT Technical Provisions – by Country

General comments:

This section relates to annual submission of information for individual entities. The template is not due when the thresholds for reporting by country described below are not applicable, i.e. the home country represents 100 % of the sum of the technical provisions calculated as a whole and gross best estimate. When this amount is higher than 90 % but lower than 100 % only R0010, R0020 and R0030 shall be reported.

Undertakings shall take into account all the obligations in different currencies and convert them into the reporting currency.

The information by country shall be reported according to the following specifications:

• a) Information on the home country shall be always reported regardless of the amount of technical provisions calculated as a whole and gross best estimate;

• b) Information reported by country shall at least represent 90 % of the sum of the technical provisions calculated as a whole and gross best estimate of any line of business, as defined in Annex I to Delegated Regulation (EU) 2015/35;

• c) If a specific country has to be reported for a particular line of business to comply with sub–paragraph b) then that country shall be reported for all lines of business;

• d) The other countries shall be reported aggregated in ‘other–EEA’ or ‘other–non-EEA’

• e) For direct business information shall be reported by country where the contract was entered into;

• f) For proportional and non–proportional reinsurance information shall be reported by country of localisation of the ceding undertaking.

For the purposes of this template ‘country where the contract was entered into’ means:

• a) The country where the insurance undertaking is established (home country) when the contract was not sold through a branch or freedom to provide services;

• b) The country where the branch is located (host country) when the contract was sold through a branch;

• c) The country where the freedom to provide services was notified (host country) when the contract was sold through freedom to provide services.

• d) If an intermediary is used or in any other situation, it is a), b) or c) depending on who sold the contract.

The negative technical provisions at the level of the line of business or countries shall be considered with absolute value for the purpose of the calculation of the materiality of the above thresholds.

The information to be reported shall include the volatility adjustment, the matching adjustment, the transitional adjustment to the relevant risk-free interest rate term structure and the transitional deduction to technical provisions.

S.13.01 – Projection of future gross cash flows (Best Estimate –life)

General comments:

This part of Annex II relates to annual submission of information for individual entities.

This template shall include information only in relation to the best estimates. The cash flows to be reported are gross of reinsurance and undiscounted.

Cash–flow projections such as central scenarios can be used as no perfect reconciliation with Best Estimate calculation is required. Undertakings may follow different approaches to identify Future Discretionary Benefits, e.g. using the certainty equivalent scenario or an average through all the scenarios considered. If difficult to project some future cash–flows like collective Future Discretionary Benefits the undertaking shall report the cash flow it effectively uses for calculating the Best Estimate. Other example of complex projection are reinsurance contracts covering multiple lines of business. In this case, allocation of reinsurance cash-flows by line of business should be consistent with the approach followed to unbundle insurance recoverables by line of business.

All cash flows expressed in different currencies shall be considered and converted in the reporting currency using the exchange rate at the reporting date

In case the undertaking uses simplifications for the calculation of technical provisions, for which an estimate of the expected future cash–flows arising from the contracts are not calculated, the information shall not be reported.