When Solvency II regulations take effect on Jan.1, 2016, solvency capital requirements will be applied to all insurance companies across EU Member States. These regulations will implement uniform reporting standards for all quantitative information about investments by insurance and reinsurance undertakings. However, an updated version of the solvency II tripartite data exchange table has just been released to include European Central Bank data requests as well as several code improvements and additional explanations.
“The template will now include code improvements and additional explanations.”
An updated version of the tripartite data exchange table
The Version 3.0 Tripartite Template is a standardized data exchange template to assist insurance and reinsurance providers in meeting the demands of Solvency II asset data requirements. According to a Solvency II Wire report, the template was developed in conjunction by investment associations in France, Germany and the U.K. with sponsorship from the French Asset Management Association. The three investment associations will serve as the European Solvency II Working Group to manage and update the template as needed prior to the implementation date.
The objective of the template
The template was designed to support solvency capital requirements calculation and data delivery for quantitative reporting. This is crucial because insurance companies are required to ensure compliance with Solvency II regulations by Jan. 1. The template will help investment management companies in transferring data among their own business units and externally to insurers. Further, the template was also developed so that it would be reported at the multiple investment share class level, which enables insurers to provide accurate representations of their investments in a specific share class. According to a Solvency II Wire interview with Ghislain Perisse, head of insurance business development at AXA Investment Management, the template is viewed positively by insurance providers and asset management firms.
“The template has been welcomed by asset managers and insurers,” Perisse explained. “As of now ten European investment associations and EFAMA are on board and are promoting the use of the template to their members. The initiative has also been welcomed by insurance associations and is becoming a common feature in many Solvency II data RFPs.”
Ultimately, the Version 3.0 Tripartite Template is an asset management initiative to simplify and accelerate reporting and response processes under Solvency II requirements. The template’s common data capture capabilities will streamline the reporting process, which addressed a previous issue that existed before the template. This main issue with previous standardized reporting formats was that it made it more difficult for insurers to capture the relevant data within established time frames.
This is particularly important because in the previous reporting regime, only broad interim metrics were required. Therefore, in effect, this template will support the more rigorous reporting process among insurance and reinsurance companies that invest in funds, by ensuring that the undertakings of their investment portfolios are in compliance with regulatory bodies.