From 31 December this year, the UK's general insurers must comply with the FSA's new risk-based capital rules.
The FSA published its capital requirements for insurers last week, based on CP190.
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From 31 December this year, the UK's general insurers must comply with the FSA's new risk-based capital rules.
The FSA published its capital requirements for insurers last week, based on CP190.
The new risk-based rules determine how much capital insurers have to hold in relation to the types of risks they underwrite.
Actuarial and planning director at Allianz Cornhill, Mark Churchlow, said the rules were "pretty much what everyone had expected".
In response to feedback, the FSA confirmed that general insurers will be able to report their enhanced capital requirement (ECR) to the FSA privately.
It also confirmed that the ERC will be a "soft" rather than "hard" capital requirement, however this aspect will be reviewed before 2006.
Under the rules, firms will be required to submit an individual capital assessment (ICA) assessing their own capital needs. This assessment will then be used by the FSA in its individual capital guidance, which reflects the FSA's view of how much capital is required to support each business.
The ERC will also be used as a benchmark by the FSA when considering the ICA.
