(38)

Article 77 is amended as follows: in paragraph 5 the first subparagraph is replaced by the following: ‘Where insurance and reinsurance undertakings value the best estimate and the risk margin separately, the risk margin shall be calculated by determining the cost of providing an amount of eligible own funds equal to the time-adjusted Solvency Capital Requirement necessary to support the insurance and reinsurance obligations over the lifetime thereof. The adjustment of the Solvency Capital Requirement consists of an exponential and time-dependent element.’; the following paragraphs are added: ‘6. The Cost-of-Capital rate referred to in paragraph 5 shall be assumed to be equal to 4,75 % as of 30 January 2027. The periodical review referred to in paragraph 5, second subparagraph, shall be undertaken by the Commission not earlier than 31 January 2032. 7. Where insurance and reinsurance contracts include financial options and guarantees, the methods used to calculate the best estimate shall appropriately reflect that the present value of cash flows arising from those contracts may depend both on the expected outcome of future events and developments and on potential deviations of the actual outcome from the expected outcome in certain scenarios. 8. Notwithstanding paragraph 7, insurance and reinsurance undertakings that are classified as small and non-complex undertakings and undertakings that have obtained prior supervisory approval may use a prudent deterministic valuation of the best estimate for life obligations with options and guarantees that are not deemed material.’ ;

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Source: EUR-Lex (Cellar) · retrieved 2026-10-14 · Text as adopted (Official Journal); later amendments are not incorporated in this text.