PRA consults on Matching Adjustment reforms

The PRA published its consultation paper (CP19/23) on 28 September 2023. This is the PRA’s long-awaited paper on reforms to the solvency regime for Matching Adjustment (MA) portfolios. CP19/23 is wide ranging with significant impacts on insurers’ balance sheets, reporting requirements and the responsibilities of senior management. It covers critical areas such as the new MA attestation process, the expansion of MA permissible assets and liabilities, reforms to the granularity and validation of credit rating processes, internal model changes, and the introduction of a regular detailed data template that needs to be provided to the PRA. The combination of these proposals could impact the level of the MA that firms currently achieve.

Download this Hot Topic to see our summary of the PRA’s consultation, and what this means for life insurers.