4
Risk Margin
4.1
Where firms value the best estimate and risk margin separately, the risk margin must be an amount equal to the cost that a Solvency II undertaking would incur in order to hold eligible own funds to cover the SCR necessary to support the insurance and reinsurance obligations over their lifetime, determined using the cost-of-capital rate.
[Note: Art. 77(5) of the Solvency II Directive]
- 01/01/2016
4.2
The risk margin must be such as to ensure that the value of the technical provisions is equivalent to the amount that a Solvency II undertaking would be expected to require in order to take over and meet the insurance and reinsurance obligations over their lifetime.
[Note: Art. 77(3) of the Solvency II Directive]
- 01/01/2016