Prudential requirements for UK insurers—Pillar 2 and Pillar 3 requirements
Produced in partnership with Clyde & Co
Prudential requirements for UK insurers—Pillar 2 and Pillar 3 requirements

The following Insurance & Reinsurance practice note produced in partnership with Clyde & Co provides comprehensive and up to date legal information covering:

  • Prudential requirements for UK insurers—Pillar 2 and Pillar 3 requirements
  • Introduction to the prudential regulatory framework
  • Pillar 2—Risk management, governance and supervision overview
  • Own risk and solvency assessment (ORSA)
  • Senior management
  • Overview of the Senior Insurance Managers Regime
  • Overview of the Senior Managers and Certification Regime
  • Governance structure—allocation of responsibilities
  • PRA Rulebook Insurance—conduct requirements
  • PRA's supervision of insurers
  • More...

Introduction to the prudential regulatory framework

This Practice Note is one of three that provides an overview of the prudential regulatory framework applicable to UK life and general insurers and reinsurers that fall within the scope of the Solvency II Directive (Directive 2009/138/EC, as amended) (Solvency II) following the implementation of Solvency II on 1 January 2016 (see Practice Note: Prudential requirements for UK insurers—introduction for information on the sources of law and regulation in respect of Solvency II). In this Practice Note, 'insurers' or 'firms' should be read in as referring to UK insurers or reinsurers that fall within Solvency II and are authorised by the Prudential Regulation Authority (PRA).

This Practice Note focuses on the Pillar 2 and Pillar 3 requirements applicable to insurers. For an introduction to the prudential regulation of insurers and information about the PRA implementation of Solvency II Pillar 1 capital and solvency requirements, see Practice Notes: Prudential requirements for UK insurers—introduction and Prudential requirements for UK insurers—Pillar 1 requirements.

Pillar 2—Risk management, governance and supervision overview

Risk management is seen as central to the prudent management and good governance of insurers and therefore forms part of the key aspects of prudential regulation.

Solvency II requires insurers to consider the risks in respect of their businesses, corresponding capital requirements and adequacy of capital resources, through an 'own risk and solvency assessment' (ORSA). This

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