PRA highlights restrictions on group own funds

Capital instruments from third-country insurers must fit Solvency II

Bank of England

European insurance groups will have to ensure capital instruments held in equivalent third-country undertakings comply with the Solvency II Directive in order to qualify as group own funds, according to a paper issued by the UK's Prudential Regulation Authority (PRA).

The document, ‘Solvency II: an update on implementation', released on July 25, lays out the PRA's interpretation of Solvency II rules on the admissibility of group own-funds items. Own funds are the capital used to satisfy Solvency