Framework of solvency and supervisory standards for insurers and reinsurers across the UK market
Following the United Kingdom’s (UK) withdrawal from the EU, the UK Government worked with regulators to adapt the UK’s financial services regulatory framework to the UK’s new position outside the EU. The revised UK prudential regime for insurers is commonly referred to as ‘Solvency UK’. However, for clarity and consistency of its policy materials, the Prudential Regulation Authority (PRA) will continue using the term ‘Solvency II’ until all references are updated across relevant materials.
The revised Solvency II framework or 'Solvency UK', is the UK's tailored regulatory framework for the insurance and reinsurance sectors, established to replace the EU's Solvency II regime post-Brexit. In general, the reforms are designed to allow UK insurers to allocate more capital to long-term investments such as infrastructure and green projects, thereby supporting broader economic goals while maintaining market stability.
The UK government launched a review of Solvency II in April 2022 to enhance the competitiveness, dynamism, and capacity of the UK insurance market to support domestic investment. This process includes repealing legislation that incorporated the Solvency II Directive into UK law and replacing it with a new regulatory framework for the insurance and reinsurance industry. This framework adapts elements from the original Solvency II Directive and its Delegated Regulation, integrating them into the Prudential Regulation Authority (PRA) Rulebook and other policy materials, including supervisory and policy statements, as well as UK statutory instruments.
On 15 November 2024, the PRA published Policy Statement 15/24 (PS15/24), marking the completion of its initial review of Solvency II regulations as applied in the UK. Importantly, within PS15/24, the PRA confirmed that firms should continue referring to the UK's solvency regime as 'Solvency II' until further notice.
A significant portion of PS15/24 focuses on updating references to EU legislation by expanding the PRA Rulebook to largely mirror relevant EU materials. It also further aligns the UK’s prudential regime for insurers, inherited from the EU, with the UK framework under the Financial Services and Markets Act 2023. The policy statement is directed at UK Solvency II firms, UK insurance undertakings (including non-directive firms), firms planning to enter the UK insurance market, and those considering transitioning to non-directive status from 31 December 2024.
Among the key changes that have been introduced are:
Solvency UK now applies to insurance regulatory reporting with reference dates of 31 December 2024 and later. As the framework moves beyond initial implementation, attention has shifted to embedding the requirements and incorporating subsequent reporting and disclosure changes into established Solvency UK processes
In July 2026, the PRA published PS18/26, finalising post-implementation amendments to Solvency UK reporting and disclosure requirements, together with targeted changes relating to Own Funds. The changes address issues identified following implementation of the revised reporting framework and apply to reporting reference dates falling on or after 31 December 2026.
The changes include updates to reporting requirements and templates, as well as the introduction of the Matching Adjustment Asset and Liability Information Return (MALIR) as a new reporting framework. This allows firms to implement the related reporting changes through a single taxonomy update.
On 2 September 2026, the Bank of England published Insurance Taxonomy 2.2.0, implementing the reporting changes introduced through PS18/26. The updated taxonomy introduces MALIR as a new reporting framework and will apply to relevant reporting with reference dates on or after 31 December 2026. The amended and new taxonomy frameworks become effective from 1 January 2027.
For insurers, the focus is therefore on incorporating these post-implementation changes into established Solvency UK reporting processes and preparing for reporting under Insurance Taxonomy 2.2.0.
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