This supervisory statement sets out the Prudential Regulation Authority's (PRA) expectations of firms in relation to existing rules on the valuation of financial assets. It applies to all PRA authorised insurers (firms) and may also be relevant to insurance holding companies and other entities in the same group, together with their advisors. The statement is equally relevant to life and general insurers, whether they are mutuals or proprietary companies.
The statement seeks to reduce the risk to the PRA's objectives caused by intended or unintended misstatement of values and hence misstatement of capital resources, by clarifying the PRA's existing expectations.
This statement does not represent a change of policy. Future clarifications or expectations on the topic of valuation risk may be added to the statement.