Prudential Regulation Authority fines U K Insurance for Solvency II reporting failures
UK insurers must evidence Solvency II reporting controls and data accuracy
Change
Prudential Regulation Authority fined U K Insurance Limited £10,625,000 for miscalculating its Solvency II balance sheet and overstating solvency to the PRA and the market.
Why it matters
The PRA found that ineffective finance and actuarial controls allowed the Solvency II miscalculation to remain undetected for a significant period. The penalty confirms that insurers must ensure prudential submissions and SFCR disclosures are accurate, complete, reliable and properly controlled.
Implications
- — UK insurers must maintain preventative and detective controls over Solvency II balance-sheet calculations because PRA fined U K Insurance after ineffective finance and actuarial controls led to overstated solvency reporting.
- — Insurance finance and actuarial teams must evidence that PRA submissions and SFCR disclosures are accurate, complete, reliable and consistent because PRA found breaches of notification and reporting rules.
- — PRA-regulated firms entering enforcement investigations must decide early whether to use the Early Account Scheme because U K Insurance received a 50% penalty reduction after early admissions and settlement.
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