Recital 90

(90) There is no legal provision specifying how to calculate group solvency when a combination of method 1 and method 2 is used. That leads to inconsistent practices and uncertainties, in particular in relation to the way of calculating the contribution to the group Solvency Capital Requirement of insurance and reinsurance undertakings included through method 2. Therefore, it should be clarified how group solvency is to be calculated when a combination of methods is used. To that end, no material risk stemming from such undertakings should be ignored in the calculation of the group solvency. However, in order to avoid material increases in capital requirements and to preserve a level playing field for insurance or reinsurance groups at global level, it should be clarified that, for the purpose of calculating the consolidated group Solvency Capital Requirement, no equity risk capital charge is to be applied to such holdings. For the same reason, a currency risk capital charge should only be applied to the value of those holdings that is in excess of the Solvency Capital Requirements of those related undertakings. Participating insurance or reinsurance undertakings should be allowed to take into account diversification between that currency risk and other risks underlying the calculation of the consolidated group Solvency Capital Requirement.

← Recital 89 · All articles · Recital 91 →

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