Outsourced head of actuarial function and outsourced actuarial function

Solvency II requires that (re)insurers regulated in Ireland appoint a Head of Actuarial Function (“HoAF”) to coordinate the activities of the actuarial function including:
  • Producing an annual Actuarial Opinion on Technical Provisions (“AOTP”) to consider the compliance of the technical provisions with all relevant Solvency II requirements.
  • Producing an Actuarial Report on Technical Provisions (“ARTP”) to support the AOTP. This reports to the board items such as the appropriateness of methodology and key assumptions, data quality and the key risks and uncertainties associated with the technical provisions.
  • Providing an opinion on underwriting policy.
  • Providing an opinion on the adequacy of the reinsurance arrangements in place.
  • Providing an opinion on the Own Risks and Solvency Assessment (“ORSA”) process and inputting to the review of the calculation of the Solvency II capital requirements.

The requirements of the HoAF and the actuarial function are set out in the Central Bank of Ireland’s Domestic Actuarial Regime (“DAR”) and guidance for (re)insurance undertakings on the head of actuarial function role.

There are many reasons why an outsourced actuarial function model can be beneficial for (re)insurers, such as meeting short-term gaps in resourcing, enhancing efficiency in a long-term model, complementing internal expertise or managing conflicts of interest between individuals’ roles and responsibilities. The HoAF role may be outsourced except in the case of (re)insurers with a High Impact PRISM rating.

We can assist you with a flexible service tailored to your specific needs, which may evolve over time. For example, we can:

  • Undertake the role of HoAF and work with your internal actuarial function.
  • Provide a full external actuarial function.
  • Support your HoAF with particular tasks such as the calculation and/or validation of technical provisions.
  • Review the calculation of Solvency II capital requirements.
  • Provide training or mentorship to a prospective HoAF.

We currently provide actuarial function services to a number of clients. We can also leverage our knowledge gained from auditing a wide range of life and non-life (re)insurance companies to provide a high-quality service.

Our actuaries have experience in the following roles:

  • Outsourced HoAF.
  • In-house HoAF.
  • Chief actuary.
  • Reviewing actuary.
  • Certification of financial projections for CBI licence applications.
  • Appointed actuary (pre SII).

We are involved in Society of Actuaries committees and working parties and attend the regular HoAF forums for both life and non-life (re)insurance.

Links to regulations

Solvency II directive 2009: eiopa.europa.eu

Solvency II delegated regulation 2015: eiopa.europa.eu

CBI guidance for (re)insurance undertakings on the head of actuarial function role 2016: centralbank.ie

CBI domestic actuarial regime 2018: centralbank.ie

CBI guidance for (re)insurance undertakings on fitness and probity amendments 2015: centralbank.ie