EIOPA Consultation On The New Proportionality Framework Under Solvency II

Overview

In August this year, the European Insurance and Occupational Pensions Authority (“EIOPA”) published a public consultation (“Consultation”) on the new proportionality framework proposed in the Provisional Agreement on amendments to the Solvency II Directive (“Provisional Agreement”).

The proposed proportionality framework aims to address concerns relating to the limited and inconsistent application of proportionality, as identified by EIOPA's 2020 Review of Solvency II, by introducing a clear legal framework and process for applying and supervising the principle of proportionality for:

1. small and non-complex undertakings (“SNCUs”) and groups (“SNCGs”); and
2. undertakings and groups not classified as small and non-complex, which are permitted to avail of certain proportionality measures.