Instruction No. 2026-I-12 on the implementation of new proportionality measures from the revision of Directive 2009/138/EC on insurance and reinsurance activities (Solvency II)

PRUDENTIAL CONTROL AND RESOLUTION AUTHORITY

Instruction No. 2026-I-12 concerning the implementation of new proportionality measures resulting from the revision of Directive 2009/138/EC 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 (known as "Solvency II") The Prudential Control and Resolution Authority, Having regard to Commission Delegated Regulation (EU) 2026/269 of 29 October 2025 amending Delegated Regulation (EU) 2015/35 as regards technical provisions, measures relating to long-term guarantees, own funds, equity risk, spread risk on securitisation positions, other capital requirements under the standard formula, disclosure and publication of information, proportionality and group solvency; Having regard to Commission Delegated Regulation (EU) 2015/35 of 10 October 2014 supplementing Directive 2009/138/EC of the European Parliament and of the Council on the taking-up and pursuit of the business of insurance and reinsurance (known as "Solvency II"); Having regard to EIOPA1 BoS-26-102 technical opinion "Technical specification for the calculation of criteria for Small and Non-Complex Undertakings (SNCUs) and Groups (SNCGs)" of 7 April 2026; Having regard to the Insurance Code, in particular its Articles L.310-3-1, L. 322-1-2,
L. 322-1-3, L. 350-2, L.352-1, L.356-1, L. 356-4, L.356-2, L. 356-27 to L. 356-38;
L. 357-1 to L. 357-12; R. 356-62 to R. 356-70; R. 357-1 to R. 357-10; A. 356-1 and
A. 357-2;
Having regard to the Monetary and Financial Code, in particular its Articles L. 517-4, L. 612-14,
L. 612-24 and R. 612-21;
Having regard to the Mutual Insurance Code, in particular its Articles L.111-4-2, L.211-10; Having regard to the Social Security Code, in particular its Articles L. 931-2-2, L.931-6; Having regard to the opinion of the Consultative Committee on Prudential Affairs (CCAP) dated 26 June 2026, 1 European Insurance and Occupational Pensions Authority (EIOPA).

DECIDES
Article 1:
The following entities are subject to this instruction:
a) insurance and reinsurance undertakings falling under the so-called "Solvency II" regime mentioned in Articles L. 310-3-1 of the Insurance Code (including captive insurance and reinsurance undertakings mentioned in 1° and 3° of Article L. 350-2), L. 211-10 of the Mutual Insurance Code and L. 931-6 of the Social Security Code; b) groups mentioned in 5° of Article L. 356-1 of the Insurance Code and subject to group supervision in application of the second and third paragraphs of
Article L. 356-2 of the same code, such as:

• insurance group companies and mutual insurance group companies
  mentioned in Articles L. 322-1-2 and L. 322-1-3 of the Insurance Code;
• mutual group unions mentioned in Article L. 111-4-2 of the Mutual Insurance Code;
• social protection insurance group companies mentioned in Article
  L. 931-2-2 of the Social Security Code;
• mixed financial holding companies mentioned in Article L. 517-4 of the
  Monetary and Financial Code, included in group supervision within the meaning of Article
  L. 356-2 of the Insurance Code;
• insurance and reinsurance undertakings falling under the so-called "Solvency
  II" regime, mentioned in Articles L. 310-3-1 of the Insurance Code, L. 211-10 of the Mutual Insurance Code and L. 931-6 of the Social Security Code, when they are also participating undertakings within the meaning of 3° of Article L. 356-1 of the Insurance Code; hereinafter referred to as "Groups". c) French sub-groups designated in application of Article L. 356-4 of the Insurance Code; hereinafter referred to as "Groups".
  Section 1: The status of small and non-complex undertaking
  Article 2:
  I. – In order to be classified as small and non-complex undertakings, the undertakings
  mentioned in a) of Article 1, other than captive insurance and reinsurance undertakings, which satisfy, on the basis of the annual accounts drawn up and transmitted to the Prudential Control and Resolution Authority, for the last two financial years immediately preceding the notification date, the criteria defined in Article R. 357-1 of the Insurance Code, the calculation methods of which are specified in EIOPA's technical opinion BoS-26-102 "Technical specification for the calculation of criteria for Small and Non-Complex Undertakings (SNCUs) and

Groups (SNCGs)", an opinion translated in Annex A, shall notify the Prudential Control and Resolution Authority. In accordance with Article R. 357-1 of the Insurance Code and, as explained in
Section 2 of EIOPA's technical opinion BoS-26-102 "Technical specification for
the calculation of criteria for Small and Non-Complex Undertakings (SNCUs) and Groups (SNCGs)", the criteria to be met by the undertaking are determined by its main activity during the last financial year:
a) Undertakings primarily carrying out life insurance activities, such that technical provisions related to life insurance activities represent at least 20% of total technical provisions, and that annual gross written premiums related to non-life insurance activities represent less than 40% of total annual gross written premiums, shall comply with the corresponding criteria in Annex A. b) Undertakings primarily carrying out non-life insurance activities, such that technical provisions related to life insurance activities represent less than 20% of total technical provisions, and that annual gross written premiums related to non-life insurance activities represent at least 40% of total annual gross written premiums, shall comply with the corresponding criteria in Annex A. c) Undertakings carrying out life and non-life activities simultaneously, such that technical provisions related to life insurance activities represent at least 20% of total technical provisions, and that annual gross written premiums related to non-life insurance activities represent at least 40% of total annual gross written premiums, shall comply with the corresponding criteria in Annex A.
II. – In order to be classified as small and non-complex undertakings, captive insurance
and reinsurance undertakings mentioned in 1° and 3° of Article L. 350-2 of the Insurance Code and included among the undertakings mentioned in a) of
Article 1, which satisfy, on the basis of the annual accounts drawn up and transmitted to
the Prudential Control and Resolution Authority, for the last two financial years immediately preceding the notification date, the criteria defined in Articles R. 357-1 and R. 357-2 of the Insurance Code, the calculation methods of which are specified in EIOPA's technical opinion BoS-26-102 "Technical specification for the calculation of criteria for Small and Non-Complex Undertakings (SNCUs) and Groups (SNCGs)", an opinion translated in Annex A, shall notify the Prudential Control and Resolution Authority. In accordance with Articles R. 357-1 and R. 357-2 of the Insurance Code, and as explained in Section 2 of EIOPA's technical opinion BoS-26-102 "Technical specification for the calculation of criteria for Small and Non-Complex Undertakings (SNCUs) and Groups (SNCGs)", the criteria to be met by the undertaking are determined by its main activity during the last financial year:
a) Undertakings primarily carrying out life insurance activities, such that technical provisions related to life insurance activities represent at least 20% of total annual gross written premiums,

related to non-life insurance activities represent less than 40% of total annual gross written premiums, shall comply with the corresponding criteria in Annex A. b) Undertakings primarily carrying out non-life insurance activities, such that technical provisions related to life insurance activities represent less than 20% of total technical provisions, and that annual gross written premiums related to non-life insurance activities represent at least 40% of total annual gross written premiums, shall comply with the corresponding criteria in Annex A. c) Undertakings carrying out life and non-life activities simultaneously, such that technical provisions related to life insurance activities represent at least 20% of total technical provisions, and that annual gross written premiums related to non-life insurance activities represent at least 40% of total annual gross written premiums, shall comply with the corresponding criteria in Annex A. By derogation from Article R. 357-1 of the Insurance Code, captive insurance undertakings and captive reinsurance undertakings are also classified as small and non-complex undertakings when they do not satisfy the criteria set out in Article R. 357-1 of the Insurance Code, if they comply with the following criteria listed in II of Article R. 357-2 of the Insurance Code:
1°) for a captive insurance undertaking, the policyholders and beneficiaries are the following entities or persons:
i. legal entities of the group to which the captive insurance undertaking
belongs;
ii. natural persons eligible for coverage under the group's insurance policies,
provided that the coverage of these natural persons remains less than 5% of the prudential technical provisions mentioned in
Article L. 351-2;
2°) for a captive reinsurance undertaking:
i. the risks accepted by the captive reinsurance undertaking are exclusively
risks of the undertaking or risks of the undertakings to which it belongs, or risks of one or more other undertakings of the group of which it is a part;
ii. the share of technical provisions covering risks related to natural
persons eligible for coverage under the group's insurance policies is less than 5% of the prudential technical provisions mentioned in Article
L. 351-2;
3°) the insurance commitments and underlying reinsurance contracts of the captive insurance undertaking or captive reinsurance undertaking do not include any mandatory civil liability insurance.

III. – For undertakings that have obtained authorisation in accordance with Articles
L. 321-1 and L. 321-1-1 of the Insurance Code, during the last two
financial years, compliance with the criteria set out in I and II of this Article is assessed by reference to the last financial year preceding the classification or, where authorisation was obtained during the last twelve months, to the business plan referred to in Articles
L. 321-10 and L. 321-10-1 of the Insurance Code.
IV. – The following undertakings cannot be classified as small and non-complex undertakings:
a) undertakings that use, to calculate their Solvency Capital Requirement, a partial or full internal model that has been approved in accordance with the requirements applicable to full and partial internal models set out in Article L.352-1 of the Insurance Code; b) undertakings that are parent undertakings of a group within the meaning of 5° of
Article L. 356-1 of the Insurance Code, to which group supervision applies in accordance with
Article L. 356-2 of the Insurance Code, unless the group is classified as a small and non-complex group;
c) undertakings that are parent undertakings of a financial conglomerate within the meaning of Article L. 517-3 of the Monetary and Financial Code; d) undertakings that are the parent undertaking of a related undertaking referred to in Article R. 356-17 of the Insurance Code; e) undertakings that manage collective retirement funds within the meaning of branch 25 of Article R. 321-1 of the Insurance Code, when the value of the assets of the collective retirement funds exceeds EUR 1,000.
Article 3:
I. – In order to be classified as small and non-complex groups, groups and sub-groups mentioned in
b) and c) of Article 1 which satisfy, on the basis of the annual accounts drawn up and transmitted to the Prudential Control and Resolution Authority, for the last two financial years immediately preceding the notification date, the criteria defined in Article R. 356-62 of the Insurance Code, the calculation methods of which are specified in EIOPA's technical opinion BoS-26-102 "Technical specification for the calculation of criteria for Small and Non-Complex Undertakings (SNCUs) and Groups (SNCGs)", an opinion translated in Annex A, shall notify the Prudential Control and Resolution Authority.
II. – Groups to which group supervision applies, in accordance with the
second and third paragraphs of Article L. 356-2 of the Insurance Code, for less than two years, shall only take into account the last financial year when assessing whether they meet the criteria defined in I of this Article.

III. – The following groups cannot be classified as small and non-complex groups:
a) groups that are financial conglomerates within the meaning of Article L. 517-3 of the Monetary and Financial Code; b) groups where at least one subsidiary undertaking is a related undertaking referred to in
Article R. 356-17 of the Insurance Code;
c) groups that use an approved partial or full internal model to calculate the group's Solvency Capital Requirement.
Article 4:
I. – The notification referred to in Articles 2 and 3 must be sent to the Prudential Control
and Resolution Authority with:

• a declaration indicating that the entity does not foresee any strategic change
  that would lead it to no longer comply with one of the criteria set out in Article R. 357-1 of the Insurance Code in the next three years;
• the desired proportionality measures using the form in Annex B;
• proof of compliance with the criteria over the two consecutive financial years immediately
  preceding the year of notification using the form in Annex C;
• in case of use of the prudent deterministic valuation provided for in Article
  R. 351-2 of the Insurance Code [Article 77(8) S2 Directive], a written declaration is expected with:
  o a clear identification of life insurance commitments with options and guarantees considered non-significant on which the prudent deterministic valuation will be carried out. o justification, based on the set of scenarios published by EIOPA, that the time value of options and guarantees on which the prudent deterministic valuation will be carried out represents less than 5% of the SCR. In case of use of the proportionality measure of cumulation of functions (excluding internal audit key function) referred to in Article L. 322-3-2 of the Insurance Code [41 §2 bis al. 2 of the S2 Directive]:
  o an identification of the person(s) exercising a cumulation of functions within the meaning of Article L. 322-3-2 of the Insurance Code [41 §2 bis al. 2 of the S2 Directive] as well as the functions concerned.
  II. – The Prudential Control and Resolution Authority may object to the classification
  of an insurance and reinsurance undertaking or a group as a small and non-complex undertaking within two months of receiving the complete notification referred to in I of this Article, in accordance with Article
  L. 357-3 of the Insurance Code.
  By derogation from the preceding paragraph, this period is extended to four months for notifications received between 30 January 2027 and 31 July 2027.

Article 5:
The proportionality measures contained in the notification referred to in Articles 2 and 3 are to be chosen by the entity from the following list:
a) Use of deterministic calculation for the best estimate referred to in Article R. 351-2 of the Insurance Code [Article 77 (8) of the S2 Directive]; b) Cumulation of functions (excluding internal audit key function) referred to in Article L. 322-3-2 of the Insurance Code [41 §2 bis of the S2 Directive]; c) Review every 5 years (instead of annually) of written governance policies referred to in
Article R.354-1 of the Insurance Code [41 §3 of the S2 Directive];
d) Exemption from short-term liquidity risk management plan (LRMP) referred to in
Article L. 354-4 of the Insurance Code [144 bis of the S2 Directive];
e) Frequency of Own Risk and Solvency Assessment (ORSA) every 2 years referred to in
Article R. 354-3-4 of the Insurance Code [45 §5 of the S2 Directive];
f) Long-term climate change scenarios in ORSA made optional referred to in
Article R.354-3-1-3 of the Insurance Code [45 bis §5 of the S2 Directive];
g) Simplified Solvency and Financial Condition Report (SFCR) (on the market participant information part), with full triennial submission, referred to in
Article R. 355-8-4 of the Insurance Code [51 §6 of the S2 Directive];
h) Exemption from the obligation to audit the SFCR economic balance sheet referred to in Article [51 bis of the S2 Directive]. Concerning the proportionality measure of cumulation of functions (excluding internal audit key function) referred to in Article L. 322-3-2 of the Insurance Code [41 §2 bis of the S2 Directive], this measure is linked to the person who would exercise the cumulation. To benefit from it, it is necessary to first make a nomination request that leads to a situation of cumulation application of Instruction No. 2026-I-13 of 10 July 2026 relating to the nomination or renewal forms of effective manager or key function holder of insurance and supplementary professional retirement undertakings, unless the entity already benefited from it before the notification, in which case only Annex B specifying it is to be transmitted and a new nomination request is not necessary.
Article 6:
I. – In application of Article L. 357-4 of the Insurance Code, entities
benefiting from small and non-complex status that do not comply, at the time of the annual accounts, with the criteria defined in Articles 2 and 3 must immediately

notify the Prudential Control and Resolution Authority at the following address:
https://acpr-portail.banque france.fr.
II. – When the situation persists for two consecutive years, the entity's classification
as small and non-complex ceases from the following financial year.
III. – When an entity classified as small and non-complex meets one
of the exclusion criteria set out in III of Article L.357-1 of the Insurance Code, it shall inform the Prudential Control and Resolution Authority without delay at the following address: https://acpr-portail.banque france.fr and ceases to be classified as a small and non-complex undertaking from the following financial year.
IV. – The loss of status in accordance with Article L. 357-4 of the Insurance Code
entails the termination of all proportionality measures.
V. – In application of Article L. 357-7 of the Insurance Code, the Prudential Control
and Resolution Authority may withdraw the benefit of one or more proportionality measures by notifying the entity, in writing, of the serious concerns provided for in Article R. 357-6 of the Insurance Code justifying the withdrawal of the proportionality measures. In this case, the entity continues to benefit from the status of small and non-complex undertaking and from the proportionality measures not covered by this withdrawal.
Article 7:
I. – In case of modification of the applied proportionality measures, entities
benefiting from small and non-complex status in application of Articles 2 and 3 shall submit Annex B to the Prudential Control and Resolution Authority, electronically by depositing it at the following address: https://acpr-portail.banque france.fr.
II. – In case of modification of the proportionality measures applied by a
entity benefiting from small and non-complex status in application of Articles 2 and 3 to add the use of the prudent deterministic valuation provided for in Article R. 351-2 of the Insurance Code [77 (8) S2 Directive], a specific written declaration is expected, accompanied by the following elements:

• a clear identification of life insurance commitments with options and
  guarantees considered non-significant on which the prudent deterministic valuation will be carried out.
• justification, based on the set of scenarios published by EIOPA, that
  the time value of options and guarantees on which the prudent deterministic valuation will be carried out represents less than 5% of the SCR. This declaration must be submitted electronically at the following address:
  https://acpr-portail.banque france.fr.
  III. – The modification of the proportionality measures applied by an entity
  benefiting from small and non-complex status in application of Articles 2 and 3 to add the cumulation of functions (excluding internal audit key function) referred to in Article
  L. 322-3-2 of the Insurance Code [41 §2 bis of the S2 Directive] can only be carried out

after approval of the nomination of the person benefiting from the measure in application of Instruction No. 2026-I-13 of 10 July 2026 relating to the nomination or renewal forms of effective manager or key function holder of insurance and supplementary professional retirement undertakings. This modification does not require, by derogation from I of this
Article, if it is the only modification to the list of proportionality measures
applied by the entity, a submission of Annex B.
Article 8:
The notification provided for in Articles 2 and 3 must be sent to the Prudential Control and Resolution Authority, electronically by depositing it at the following address:
https://acpr-portail.banque france.fr.
Section 2: Request for proportionality measure
Article 9:
Entities mentioned in Article 1 complying with the criteria listed in Articles 327 ter et seq., and Article 377 ter of the delegated regulation, as specified by the Prudential Control and Resolution Authority in the Proportionality notice of 10 July 2026, may submit a request for a proportionality measure to the Prudential Control and Resolution Authority.
Article 10:
I. – The request for a proportionality measure referred to in Article 9 must be sent
to the Prudential Control and Resolution Authority with:

• the requested proportionality measures using the form in Annex B;
• the reasons why the application of these measures is justified in relation
  to the nature, scale and complexity of the risks inherent in the entity's activity;
• any other important information concerning the entity's risk profile;
• a declaration indicating that the entity does not foresee any strategic change
  that would have an impact on its risk profile in the next three years;
• supporting documents per proportionality measure listed in Article 12.
  II. – Within two months of receiving the request referred to in Article 9, the Authority