Managing agents should ensure syndicates Solvency Capital Requirement (SCR) appropriately reflects their risk profile and is calculated using a SII compliant internal model.
To support this, managing agents should ensure their syndicates:
Managing agents should ensure syndicates Solvency Capital Requirement (SCR) appropriately reflects their risk profile and is calculated using a SII compliant internal model.
To support this, managing agents should ensure their syndicates:
Maintain an internal model which captures all material risks that the syndicate is exposed to
Use modelling assumptions which are realistic and justifiable, methodology which is adequate and all material limitations are understood
Have strong feedback loops joining the business and the model
Demonstrate robust governance and understanding of the model. This includes adequate understanding and challenge at senior management level.
Implement changes to the model which are reasonable and justified and their impact on the SCR adequately explained
Conduct objective challenge of the internal model through independent validation
Below are some of the frequently asked questions about this Principle, including the questions that were asked in the Technical Briefing session(s).
If you have any further questions, please reach out to Oversight.Framework@lloyds.com