Prudential Standard PDI (Public Disclosures by Insurers)

Question 1

This Standard set out…

Answer 1

requirements for annual public disclosures
… of specific quantitative and qualitative information
… by insurers pursuant to Section 45 of the Insurance Act, 2017

in order to give policyholders and market participants a clear view of their:

• business activites,
• performance and
• financial position.

Question 2

5 Key requirements of the standard

Answer 2

Insurers must publicly disclose information on its:

• business profile
• financial performance
• financial soundness position
• risk exposures and risk management, and
• governance framework

Question 3

Treatment of confidential information

Answer 3

Consistent with Section 45(2) of the Insurance Act, 2017:

Information that is confidential / proprietary need not be publicly disclosed,
although PRIOR APPROVAL for non-disclosure is required.

This includes, e.g.,

• confidential customer information
• information that would afford competitors undue competitive advantage

Question 4

Required publications (2)

Answer 4

Insurers are required to publish public quantitative and qualitative information reported in the AUDITED annual:

• Quantitative Reporting Template (QRT)
• Quantitative Regulatory Return (QRR)

Question 5

Internal controls are required over the disclosure process to ensure that the information disclosed is: (6)

Answer 5

• timely
• comprehensive
• meaningful
• reliable
• comparable to other insurers in the same market
• consistent over time

Question 6

Deadline for reporting relevant info

Answer 6

• On an annual basis

- by no later than 4 months after its financial year end

Question 7

Business profile disclosures (8)

Answer 7

Must enable policyholders to understand:

• the sources of INCOME and EARNINGS
• development in the EXTERNAL ENVIRONMENT that could significantly impact the insurer
• the BUSINESS STRATEGY and objectives of the insurer
• the insurer’s OWNERSHIP
• the insurer’s CLASSES and SUB-CLASSES of insurance business
• the GEOGRAPHICAL AREAS where it writes business (and level of activity in these)
• business other than insurance business that the insurer conducts
• if belonging to a group, information of the legal and organisational GROUP STRUCTURE and the business functions undertaken within the group

Question 8

Financial Performance disclosures: (3)

Answer 8

• performance from underwriting activities
• performance from investment activities
• operating/other income and expenses

Question 9

Financial Soundness Position disclosures: (8)

Answer 9

• Technical provisions
• Other liabilities
• Financial Soundness position:
• – General capital management
• – Structure, amount and quality of own funds
• – MCR and SCR
• – Main differences between standard model and internal model
• – Non-compliance with MCR and SCR (if significant)

Question 10

Risk Exposures and Risk Management disclosures: (5)

Answer 10

• General risk management information (risk limits & appetite)
• Material risk exposures
• Material risk concentrations
• Material risk mitigation
• Risk sensitivity

Question 11

Governance Framework Disclosures: (3)

Answer 11

• Key features of the governance framework:
• – Board composition
• – Board committees
• – Risk management policies
• – Internal controls
• – Control functions
• Outsourcing policy and how it maintains control, ownership and oversight over the outsourced function
• Info on key business functions:
• – how they’re organised
• – board oversight
• – changes to key personnel
• – management infrastructure