Following its consultation on effective financial management and planning for insurance firms and groups, the PRA has now published its final policy statement PS10/18, and Supervisory Statement SS4/18, ‘Financial management and planning by insurers’.
The Supervisory Statement (which has been modified in the light of responses to the consultation) includes a framework for the:
- development and maintenance of a risk appetite statement by an insurer;
- application of this risk appetite to the insurer’s business and financial plans; and
- assessment of the suitability and sustainability of capital distribution plans in the context of this risk appetite.