The answer in relation to this captive capital requirements question refers to ICA. This individual capital assessment approach came into effect in 2004. Some of the criteria seem very similar to solvency II. However, I'm unsure of its use today. Does solvency II supersede this now, or because this question focuses on Captives should ICA be used instead? And further in what case does ICAS come into play now, if anymore. I can't find any details on this. Thanks
Solvency II has superseded both ICAs and the ICAS regime. In fact S2 is widely felt to have delivered improvements over the ICAS regime in relation to Group capital adequacy measurement. So even in a post-Brexit world there is commitment to maintaining the S2 approach for insurance groups. Captives, as a subsidiary of an insurance group, would come under this bracket. So a captive must cover its own SCR, while the group as a whole must cover its overall group SCR. The captive is likely to be located in a non-EEA third country, but Bermuda (and other countries) have equivalence arrangements in place. This is discussed in more detail in Section 3.8 of Chapter 4.
Thanks very much for this Katherine. Do you know if there are any summaries identifying past q's where the regulation or other is now obsolete? (maybe not irrelevant as these q's as still good practice)
Not particularly James, but Solvency II has superseded all regulation and of course IFRS 17 has superseded IFRS 4 and any previous international accounting standards (IAS).
