Recommendations on supervisory flexibility regarding the deadline for regulatory reporting and public disclosure – coronavirus/COVID-19

EIOPA-BoS-20/236 20 March 2020

Recommendations on supervisory flexibility regarding the deadline for regulatory reporting and public disclosure – coronavirus/COVID-19

1. Introduction
2. In accordance with Article 16 of Regulation (EU) No 1094/2010¹ (the EIOPA Regulation), EIOPA issues these recommendations for the insurance sector in light of the coronavirus/COVID-19 epidemic situation.
3. These Recommendations are based on Directive 2009/138/EU² (Solvency II Directive) and EIOPA’s guidelines and other relevant EIOPA instruments, and are addressed to competent authorities.
4. Given that insurance and reinsurance undertakings will likely face increasingly challenging conditions in the near future in terms of navigating demanding market environments, EIOPA considers that undertakings must focus their efforts on monitoring and assessing the impact of the coronavirus/COVID-19 situation and ensuring business continuity. In this context, submitting information to competent authorities for the first quarter of 2020 will be of exceptional importance both for insurance and reinsurance undertakings and for competent authorities.
5. Since some competent authorities have already taken measures to address the consequences of the coronavirus/COVID-19 epidemic, it is of exceptional importance to urgently establish a framework for consistent supervisory approaches. Therefore, the general objective of these Recommendations is to ensure convergence and consistent supervisory approaches across all Member States when enabling flexibility regarding regulatory reporting and public disclosure of information by insurance and reinsurance undertakings.
6. Given the need for an urgent supervisory response to mitigate the negative effects of the coronavirus/COVID-19 in the insurance sector, EIOPA has not conducted open public consultations nor requested an opinion from the insurance and reinsurance stakeholder group.
7. Terms not defined in these Recommendations have the meaning given in the legal acts referred to in the introduction.
8. These Recommendations apply from the date of publication of their English version on EIOPA’s website.
9. The objective of the Recommendations set out below is to provide operational support to insurance and reinsurance undertakings and to support the continuity of their business. However, insurance and reinsurance undertakings may choose to submit a complete reporting package at any time before the shortest deferral period set out below. This option may also be used in case of unplanned burden created by the proposed forms of support in certain situations (e.g., when splitting the reporting package into two parts).

¹ Regulation (EU) No 1094/2010 of the European Parliament and of the Council of 24 November 2010 establishing a European Supervisory Authority (European Insurance and Occupational Pensions Authority), amending Decision No 716/2009/EU and repealing Commission Decision 2009/79/EZ (OJ L 331, 15.12.2010, p. 48–83.) ² Directive 2009/138/EU of the European Parliament and of the Council of 25 November 2009 on the taking-up and pursuit of the business of Insurance and Reinsurance (Solvency II) (OJ L 335, 17.12.2009, p. 1–155.)

1. Recommendation – Annual reporting for the year ending on 31 December 2019 or after that date but before 1 April 2020.

2. Competent authorities should accept a deferral of the deadline for submitting the regular supervisory report at both individual and group level by eight weeks.

3. Competent authorities should accept a deferral of the deadline for submitting templates for annual quantitative reporting by eight weeks, with the following exceptions: Content of submission (S.01.01), Basic information (S.01.02), Balance sheet (S.02.01), Cash flow projections for life insurance business (S.13.01), Long-term guarantees (S.22.01), Own funds (S.23.01) and Calculation of Solvency Capital Requirement (from S.25.01 to S.25.03) at the individual level.

4. Competent authorities should accept a deferral of the deadline for submitting templates for annual quantitative reporting by eight weeks, with the following exceptions: Content of submission (S.01.01), Basic information (S.01.02), Balance sheet (S.02.01), Long-term guarantees (S.22.01), Own funds (S.23.01), Calculation of Solvency Capital Requirement (from S.25.01 to S.25.03) and Undertakings within the group (S.32.01) at the group level.

5. Competent authorities should accept a deferral of the deadline for submitting the templates described in the previous paragraphs 10 and 11 by two weeks.

6. Competent authorities should use the Technical Annex to these Recommendations for technical details on submitting annual quantitative reporting templates in two separate parts.

7. Competent authorities that have used the option to exempt undertakings from quarterly reporting may consider requesting additional templates from undertakings that have not submitted reports for the fourth quarter of 2019 as part of the annual submission with a two-week deferral: Assets (S.06.02), Transparent approach information (S.06.03), Technical provisions for life insurance (S.12.01) and Technical provisions for non-life insurance (S.17.01) at the individual level.

8. Competent authorities should apply similar flexible approaches to all specific national reporting requirements or additional requirements (e.g., deadlines for own risk and solvency assessment reports, audit requirements, etc.).

9. Competent authorities should forward received information to EIOPA no later than four weeks after receipt.

10. Recommendation – Quarterly reporting for the first quarter of 2020 ending on 31 March 2020 or after that date but before 30 June 2020.

11. Competent authorities should accept a one-week deferral for submitting templates for quarterly quantitative reporting and the financial stability report for the first quarter of 2020 at both individual and group level, with the following exception: Derivatives transactions (S.08.02) in quantitative reporting templates.

12. For this quarterly reporting, early submission of reports is encouraged. Recognising the importance of focusing efforts on overall accuracy of submissions, if necessary, undertakings may consider a proportional approach to less relevant aspects of calculations.

13. Competent authorities should accept a deferral of the deadline for submitting the Derivatives transactions (S.08.02) template by four weeks.

14. Insurance and reinsurance undertakings are expected to state in the Own funds (S.23.01) template their estimate of the Solvency Capital Requirement for the reference date at the end of the quarter, rather than the last calculated Solvency Capital Requirement as stated in the Instructions.

15. Competent authorities should forward received information to EIOPA no later than four weeks after receipt.

16. Recommendation – Solvency and Financial Report for the year ending on 31 December 2019 or after that date but before 1 April 2020.

17. Competent authorities should accept an eight-week deferral for publishing the Solvency and Financial Report (SFCR), with the exception of the following information: Balance sheet (S.02.01), Long-term guarantees (S.22.01), Own funds (S.23.01) and Calculation of Solvency Capital Requirement (S.25.01) using the templates as established by Commission Implementing Regulation (EU) 2015/2452³ at both individual and group level.

18. Competent authorities should accept a two-week deferral for publishing the aforementioned templates, using the public disclosure tools normally used for SFCR publication.

19. Insurance and reinsurance undertakings should currently consider the situation as a “significant change” as stated in Article 54(1) of the Solvency II Directive and simultaneously with the publication of public information relating to the year ending on 31 December 2019 or after that date, publish all relevant information on the impact of the coronavirus/COVID-19 epidemic within the published information.

Compliance and reporting rules 25. This document contains recommendations issued in accordance with Article 16 of the EIOPA Regulation. In accordance with Article 16(3) of the EIOPA Regulation, competent authorities and financial institutions shall make all efforts to comply with these recommendations. 26. Competent authorities that are aligned or intend to align with these Recommendations should incorporate them into their regulatory or supervisory framework in an appropriate manner. 27. Competent authorities should confirm to EIOPA whether they are aligned or intend to align with these Recommendations, or state the reasons for any non-alignment within two months of publication of the translated versions. 28. In case competent authorities do not respond within the specified period, they are considered non-aligned with the reporting rules and reported as such.

Final provision on review 29. These Recommendations are subject to EIOPA’s review.

³ Commission Implementing Regulation (EU) 2015/2452 of 2 December 2015 laying down implementing technical standards with regard to procedures, formats and templates for the Solvency and Financial Report in accordance with Directive 2009/138/EU of the European Parliament and of the Council (OJ L 347, 31.12.2015, p. 1285.).

Technical Annex Undertakings and competent authorities using EIOPA’s XBRL taxonomy should apply the following specific instructions: • To meet these specific requirements, the current 2.4.0 taxonomy may be used. No updates to the taxonomy in the form of urgent fixes are required; • Exemptions for templates for the first temporary/incomplete report are marked in the relevant fields of the Content of submission (S.01.01) template as “0 – Not reported for another reason”. In this case, the specific explanation relates to the coronavirus/COVID-19 epidemic situation; • Subsequent (re-submitted) submissions must cover all previously submitted templates for the period (i.e., the complete final report should be fully complete); • EIOPA may also apply specific measures regarding taxonomy data checks and modify the severity from blocking status to non-blocking status to facilitate reporting, for example, in case of checks related to the content submission template; • Undertakings that can already submit a complete package within the first submission are encouraged to do so as soon as possible and within statutory deadlines. In such cases, subsequent submissions are not required unless subsequent corrections are needed; • Additional taxonomy specifications and further updates to the list of checks will be available in the coming days on EIOPA’s website and on websites of competent authorities linked to the taxonomy.