This Prudential Regulation Authority (PRA) Policy Statement (PS) provides feedback to responses to Consultation Paper (CP) 14/17 ‘Strengthening individual accountability in insurance: extension of the Senior Managers and Certification Regime to insurers’, and CP28/17 ’Strengthening accountability: implementing the extension of the SM&CR to insurers and other amendments’. It also provides:
- the final rules for the extension of the Senior Managers and Certification Regime (SM&CR) to insurers by amending the Senior Insurance Managers Regime (SIMR) (Appendix 1)
- an updated Supervisory Statement (SS) 35/15 ‘Strengthening individual accountability in insurance’ (Appendix 2), and terminology updates to other existing SSs; (SS3/17, SS39/15, SS5/16, SS10/16 and SS28/15)
- a consolidated Statement of Policy (SoP) ‘Conditions, time limits, and variations of approval’ (Appendix 3)
- the streamlined set of forms for the SM&CR, and amendments to Part 4A permissions forms (Appendix 4)
This PS is relevant to all Solvency II insurance firms (UK Solvency II firms, the Society of Lloyd’s and managing agents, and third country (re)insurance branches), and to insurance special purpose vehicles (ISPVs) , large non-Directive firms (large NDFs), and small non-Directive firms (small NDFs) (collectively referred to as ‘insurers’). Chapter 3 is relevant to all PRA regulated firms.
This PS should be read in conjunction with Financial Conduct Authority (FCA) PS18/14, FCA PS18/15 and FCA PS18/16, which provides feedback to the responses to FCA CP17/26, CP17/41, and CP17/42, and contains the FCA’s equivalent policy to implement the extension of the SM&CR to insurers.
The extended SM&CR for insurers will not come into effect until commencement regulations have been made by HM Treasury for the relevant amendments to FSMA in the 2016 Act. If necessary, the PRA will amend our rules accordingly.
Summary of responses to CP14/17 and CP28/17
The PRA received 14 responses to the proposals in CP14/17 relating to the extension of the SM&CR to insurers, and eight responses to the proposals in CP28/17 relating to the implementation of the proposed extension of the SM&CR and other amendments. The responses received were broadly supportive of the policy intent and the PRA has made some minor changes to the policy proposals as a result of feedback.
- Chapter 2 summarises feedback on the PRA’s proposals in CP14/17 and the PRA’s final policy.
- Chapter 3 summarises feedback on the PRA’s proposals in CP28/17 and the PRA’s final policy.
- Chapter 4 sets out the various timelines for implementing the rules and expectations in this PS.
The timelines and relevant measures for the implementation of the final rules in this PS are as set out in Chapter 4.
The PRA intends to publish a further CP with some consequential amendments to its rules prior to the policy commencement date, so as to ensure that the rules in the PRA Rulebook are suitably cross-referenced and aligned to those in the FCA’s Handbook. These consequential changes are not intended to make any substantive change to the final policy and rules in this PS.
- PRA RULEBOOK: SOLVENCY II FIRMS, NON-SOLVENCY II FIRMS: SENIOR INSURANCE MANAGERS REGIME (AMENDMENT) INSTRUMENT 2018
- Supervisory Statement 35/15 ‘Strengthening individual accountability in insurance’
- Statement of Policy ‘Conditions, time limits, and variations of approval’
- Directory of streamlined set of forms for the SM&CR, and amendments to Part 4A permissions forms