EU Solvency II Capital Requirements Illustration

EU Solvency II Capital Requirements Illustration

Sukhy Kaur

15 years: Debt capital markets

In this video, Sukhy explains us about Own Funds and it's types - "Basic Own Funds" and "Ancillary Own Funds". She further highlights how much available capital Unlock Insurance has to cover its Minimum and Solvency Capital Requirements.

In this video, Sukhy explains us about Own Funds and it's types - "Basic Own Funds" and "Ancillary Own Funds". She further highlights how much available capital Unlock Insurance has to cover its Minimum and Solvency Capital Requirements.

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EU Solvency II Capital Requirements Illustration

10 mins 1 sec

Overview

As part of the capital requirements under the Solvency 2 regime, European insurers are required to comply with the Solvency Capital Requirements and Minimum Capital Requirements. This guarantees that insurers always have enough capital available to withstand certain tail risk events. We dig into the detail around the coverage ratios of these requirements. In particular we delve into the definition of Own Funds and how much of this capital is actually eligible for the purposes of these ratios. We also apply this to calculate the SCR and MCR coverage ratios for a fictional company – Unlock Insurance

Key learning objectives:

  • What are Own Funds?

  • What are Eligible Own Funds?

  • How can we apply this to Unlock Insurance?

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Summary
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Expert
Sukhy Kaur

Sukhy Kaur

Sukhy has spent over 11 years working in investment banking. She started her career at Barclays Capital and then went onto join the hybrid capital desk at Credit Agricole, focusing on structuring and the initial regulatory developments of Basel 3. Continuing in the structuring space, she moved to the Capital Solutions desk at UBS Investment Bank.

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