Since the 1st
January, the Solvency 2 standard has been in force.
This has, among others, introduced the actuarial function as one of the four key functions of the governance system. It thus considerably modified and reinforced its role. This is expressed in concrete terms by an actuarial function report having to be drawn up, whose contents have been broadly extended in relation to that of the actuary appointed under Solvency 1.
Standard ESAP 2 (European Standard of Actuarial Practice 2). Standard ESAP 2 was published and adopted by the EAA (European Actuarial Association) on the 31st January 2016.
The aim of ESAP 2 is to provide guidelines to actuaries in drawing up the actuarial function report so that this complies with reporting requirements of article 48 of Directive 2009/138/EC and article 272 of the delegated regulation 2015/35 of the commission of the 10thOctober 2014.
One of the main objectives of ESAP 2 is to give the report reader, among which the Administrative Council and the Supervisor, a high level of trust as to the information contained in it.
ESAP 2 is based on four major principles:
- Coherence with the Solvency 2 standard
- Proportionality to the nature, importance and complexity of underlying risks
- Coherence in relation to the professional code of conduct
- The structure adapted to the needs of the Administrative, Management and Supervisory Body (AMSB)
ESAP 2 describes the four fields about which the actuarial function must give an opinion:
- Technical provisions
- Subscription policy
- The contribution of the actuarial function to risk management
Act-unity can help you to put your actuarial function in place and to draw up/validate your actuarial report.
Our approach intends to be pragmatic: we have established a checklist of the contents of the actuarial function tasks and are carrying out a gap-analysis in relation to your situation. On the basis of this, we are establishing a compliance upgrade schedule the final result of which is the actuarial function report.