Under Solvency II, a passport is available to insurers carrying on direct

insurance business only, or a combination of direct and reinsurance business. Solvency II requires undertakings headquartered outside the EU to obtain authorisation as a third country branch if they want to provide insurance services other than exclusively reinsurance business in the EEA. So, if the UK, following Brexit, will be considered a third country under Solvency II, insurance companies headquartering in the UK would need to apply for branch authorisation in one or more EEA Member States.

The most significant impact will be linked to capital requirements, as licensed branch operating entities would be allowed to calculated their SCR in relation to their entire EEA business by taking into account only the operations of branches in the EEA.

Equivalence of the UK would have difference effects under Solvency II with view on resinsurance, the group solvency calculation as well as the group supervision.

Given the potential loss of passporting right, insurers now prepare for any necessary group reorganisations.