Solvency II Review 2027: what insurers need to change before 30 January.
The revised Solvency II framework applies from 30 January 2027. Insurers should assess technical provisions, risk margin, proportionality, liquidity, reporting, governance and the evidence used to demonstrate implementation.
Why January 2027 requires an implementation programme
The review changes the existing prudential framework rather than replacing it. Directive (EU) 2025/2 amends Directive 2009/138/EC, while Commission Delegated Regulation (EU) 2026/269 updates the detailed framework. Member States must publish their transposition measures by 29 January 2027 and apply them from 30 January 2027.
Keep source status explicit. EIOPA's 15 July 2026 package contains final guidelines and draft technical standards submitted to the Commission. A final EIOPA report on a draft standard is not itself Commission adoption. Record the applicable Commission act and Official Journal reference separately from the EIOPA publication.
A calculation change can affect actuarial methodology, data, model documentation, finance outputs, reporting and governance evidence together. Assess every requirement against the operating model rather than routing it to one technical team. For the underlying framework, see the Solvency II overview.
What changes in 2027: before, after and implementation action
These selected changes help prioritise an impact assessment. They do not replace an entity-level inventory of the reviewed framework, national measures and supervisory requirements.
| Before the review | 2027 change | Who should assess it | Source and status | Implementation action |
|---|---|---|---|---|
| Risk margin: 6% cost-of-capital rate | 4.75% cost-of-capital rate; the methodology also incorporates a time-dependent lambda factor. | Insurers calculating the Solvency II risk margin | Adopted Directive, amended Article 77(6); final technical-provisions guidelines, applicable 30 January 2027 | Separate rate and methodology effects in parallel runs; approve the model, assumptions and reporting changes. |
| Proportionality: existing proportionality measures | A defined small and non-complex undertaking classification, with qualifying criteria assessed over two consecutive financial years. | Potentially eligible undertakings; assess group criteria separately | Adopted Directive, Articles 29a–29b; published EIOPA technical specifications | Collect two years of criteria evidence and prepare the notification; document intended simplifications and exclusions. |
| Matching adjustment: existing treatment of diversification between portfolios | Full diversification with the rest of the undertaking can be assumed for SCR calculation where the assigned portfolio does not form a ring-fenced fund. | Undertakings using the matching adjustment | Adopted Directive, amended Article 111; EIOPA draft ITS final report, published July 2026 | Record the ring-fencing conclusion and test the resulting SCR aggregation and approval documentation. |
| Liquidity: existing liquidity-risk management | A short-term liquidity-risk management plan, subject to specified exemptions, plus risk indicators. | Assess undertaking and group scope, including SNC and supervisory-approved plan exemptions | Adopted Directive, Articles 144a and 246a; final liquidity-vulnerability guidelines | Document scope or exemption, cash-flow projections, indicators, escalation and plan ownership. |
Reporting and public disclosure
Inventory affected templates and instructions, compare old and new data definitions, update validation rules, test source-to-report lineage and preserve review and sign-off evidence. Review related dependencies in the Solvency II TPT guide.
Governance, ORSA and evidence
The ORSA remains part of the risk-management system under Article 45. Route material risk-profile and strategic impacts into the ORSA governance workflow, with an owner, affected policy or model, control, evidence and status for each change.
Solvency II Review 2027 implementation checklist
| Step | Question | Evidence to retain |
|---|---|---|
| Establish scope | Which Level 1, Level 2, guidelines and standards apply? | Source inventory, applicability decisions and legal review |
| Assess impact | Which calculations, models, reports, policies and controls change? | Requirement-to-process and control mappings |
| Assign ownership | Who owns interpretation, implementation, testing and approval? | RACI, governance minutes and escalation record |
| Update methodology | What assumptions, formulas, data or modelling steps change? | Method papers, model versions and approvals |
| Update reporting | Which templates, definitions and validation rules change? | Data dictionary, lineage, reconciliations and tests |
| Validate | Do new results flow correctly to every output? | Parallel runs, exceptions, remediation and sign-off |
| Operationalise | How will later regulatory changes be monitored? | Change workflow, alerts and review evidence |
A practical implementation timeline
September–October 2026: establish a versioned source inventory, identify affected entities and build the requirement-to-operating-model map. Track subsequent adoption and national measures as changes to that baseline.
October–November 2026: approve interpretations, update methods and data requirements, and design model, reporting and control changes.
November–December 2026: complete parallel calculations, reporting dry runs, control testing and governance review.
January 2027: deploy approved changes, confirm production lineage and access, complete sign-off and prepare the evidence package.
Connect prudential and accounting impacts through the Solvency II and IFRS 17 operating model.
From a source change to an implementation decision
A practical starting point is one affected obligation, such as the risk-margin methodology. RegReview supports monitoring and review of the source change; RegMatcher connects approved obligations to policies, controls, owners and evidence. Actuarial systems remain responsible for calculations, and designated reviewers approve interpretations and implementation decisions.
- Capture the change: retain the source version, legal status, effective date and affected entities.
- Assess the operating impact: connect the obligation to the methodology paper, model-change control and reporting procedure; record the reviewer's gap assessment.
- Assign the action: identify the owner and due date, then link the parallel-run results, exceptions and approval evidence.
- Revisit on change: route a later technical standard or supervisory clarification back to the affected assessment.
Choose risk margin, proportionality or liquidity for your demo. The discussion can focus on how your team would track one change from the source through the control gap, owner and implementation evidence.
Frequently asked questions
When does the revised Solvency II framework apply?
The principal reviewed framework and related changes are intended to apply from 30 January 2027. Firms should confirm the applicable EU instruments, national transposition and supervisory communications for every entity in scope.
Does the Solvency II review replace the existing Directive?
No. It amends the existing Solvency II framework. Implementation inventories should show what changed, what remained in force and which consolidated source version controls each conclusion.
Is the review only an actuarial calculation change?
No. It includes calculation-related changes, but it can also affect proportionality, governance, liquidity, reporting, disclosure, documentation and supervisory evidence.
What should an insurer finish before January 2027?
At minimum: an approved applicability assessment, updated methodologies and controls, tested calculations and reports, assigned ownership, resolved exceptions and a traceable evidence pack.
How should the review connect to ORSA?
Assess whether the changes affect the undertaking's risk profile, overall solvency needs, continuous compliance, scenarios or strategic decisions. Preserve the link between the regulatory change, ORSA analysis, management conclusion and resulting action.
This guide is general information, not legal or actuarial advice. Confirm national transposition, supervisory communications and the facts of each entity.