(50)

Article 109 is replaced by the following: ‘Article 109 Simplifications in the standard formula 1. Insurance and reinsurance undertakings may use a simplified calculation for a specific risk module or risk sub-module where all the following conditions are met: Notwithstanding the first subparagraph, small and non-complex undertakings may use a simplified calculation for a specific risk module or risk sub-module where they can demonstrate to the satisfaction of the supervisory authority and at least every five years that the following conditions are met: For the purposes of this paragraph, simplified calculations shall be calibrated in accordance with Article 101(3). 2. Without prejudice to paragraph 1 of this Article and to Article 102(1), where an insurance or reinsurance undertaking calculates the Solvency Capital Requirement and a risk module or risk sub-module does not represent a share of more than 5 % of the Basic Solvency Capital Requirement referred to in Article 103, point (a), the undertaking may use a simplified calculation for that risk module or risk sub-module during a period of no more than three years following that calculation of the Solvency Capital Requirement. 3. For the purposes of paragraph 2, the sum of the shares, relative to the Basic Solvency Capital Requirement, of each risk module or risk sub-module where the simplified calculations pursuant to that paragraph are applied shall not exceed 10 %. The share of a risk module or risk sub-module relative to the Basic Solvency Capital Requirement referred to in the first subparagraph of this paragraph shall be that share as calculated the last time when the risk module or risk sub-module was calculated without a simplified calculation pursuant to paragraph 2.’ ; the nature, scale and complexity of the risks they face justifies the use of a simplified calculation; it would be disproportionate to require the insurance or reinsurance undertaking to apply the standardised calculation; the error compared to the standardised calculation does not lead to a material misstatement of the Solvency Capital Requirement, except in cases where the simplified calculation leads to a Solvency Capital Requirement which exceeds the Solvency Capital Requirement that results from the standardised calculation. each individual risk module or risk sub-module for which a simplified calculation is intended to be used, represents, without applying the simplification, less than 2 % of the Basic Solvency Capital Requirement; the sum of all risk modules or risk sub-modules for which a simplified calculation is intended to be used, represents, without applying the simplification, less than 10 % of the Basic Solvency Capital Requirement.

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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.