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MCR Notional Composite Split

Calculate the Notional Non-Life Minimum Capital Requirement and Notional Life Minimum Capital Requirement instantly.

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Notional Non-Life MCR

€21 081 000

1Step 1

Notional Non-Life Linear MCR

Notional Non-Life Linear MCR=Non-Life Component for Non-Life Activity+Life Component for Non-Life Activity\textit{Notional Non-Life Linear MCR} = \textit{Non-Life Component for Non-Life Activity} + \textit{Life Component for Non-Life Activity}
2Step 2

Notional Life Linear MCR

Notional Life Linear MCR=Non-Life Component for Life Activity+Life Component for Life Activity\textit{Notional Life Linear MCR} = \textit{Non-Life Component for Life Activity} + \textit{Life Component for Life Activity}
3Step 3

Notional Non-Life SCR

Notional Non-Life SCR=Notional Non-Life Linear MCRNotional Non-Life Linear MCR+Notional Life Linear MCR×Total SCR Excluding Capital Add-On\textit{Notional Non-Life SCR} = \frac{\textit{Notional Non-Life Linear MCR}}{\textit{Notional Non-Life Linear MCR} + \textit{Notional Life Linear MCR}} \times \textit{Total SCR Excluding Capital Add-On}
4Step 4

Notional Life SCR

Notional Life SCR=Notional Life Linear MCRNotional Non-Life Linear MCR+Notional Life Linear MCR×Total SCR Excluding Capital Add-On\textit{Notional Life SCR} = \frac{\textit{Notional Life Linear MCR}}{\textit{Notional Non-Life Linear MCR} + \textit{Notional Life Linear MCR}} \times \textit{Total SCR Excluding Capital Add-On}
5Step 5

Notional Combined Non-Life MCR

Notional Combined Non-Life MCR=min⁡(max⁡(Notional Non-Life Linear MCR,Notional Non-Life SCR+Notional Non-Life Add-On×Notional MCR Floor Factor),Notional Non-Life SCR+Notional Non-Life Add-On×Notional MCR Ceiling Factor)\textit{Notional Combined Non-Life MCR} = \min(\max(\textit{Notional Non-Life Linear MCR}, \textit{Notional Non-Life SCR} + \textit{Notional Non-Life Add-On} \times \textit{Notional MCR Floor Factor}), \textit{Notional Non-Life SCR} + \textit{Notional Non-Life Add-On} \times \textit{Notional MCR Ceiling Factor})
6Step 6

Notional Combined Life MCR

Notional Combined Life MCR=min⁡(max⁡(Notional Life Linear MCR,Notional Life SCR+Notional Life Add-On×Notional MCR Floor Factor),Notional Life SCR+Notional Life Add-On×Notional MCR Ceiling Factor)\textit{Notional Combined Life MCR} = \min(\max(\textit{Notional Life Linear MCR}, \textit{Notional Life SCR} + \textit{Notional Life Add-On} \times \textit{Notional MCR Floor Factor}), \textit{Notional Life SCR} + \textit{Notional Life Add-On} \times \textit{Notional MCR Ceiling Factor})
7Step 7

Notional Non-Life MCR

Notional Non-Life MCR=max⁡(Notional Combined Non-Life MCR,Notional Non-Life Absolute Floor)\textit{Notional Non-Life MCR} = \max(\textit{Notional Combined Non-Life MCR}, \textit{Notional Non-Life Absolute Floor})
8Step 8

Notional Life MCR

Notional Life MCR=max⁡(Notional Combined Life MCR,Notional Life Absolute Floor)\textit{Notional Life MCR} = \max(\textit{Notional Combined Life MCR}, \textit{Notional Life Absolute Floor})

Understand the MCR Notional Composite Split

Overview

This calculator implements the Notional Minimum Capital Requirement (NMCR) split for composite insurance undertakings within the Solvency II standard formula.[1] It sits after the Article 250 non-life and Article 251 life linear component calculators and separates the Article 252 notional non-life and notional life MCRs.[2]

Input Terms

  • Non-Life Component for Non-Life Activity: Article 250 non-life component allocated to the non-life activity.[3][2]
  • Life Component for Non-Life Activity: Article 251 life component allocated to the non-life activity. This component can be negative if the future discretionary benefits leg is large.[4][2]
  • Non-Life Component for Life Activity: Article 250 non-life component allocated to the life activity.[3][2]
  • Life Component for Life Activity: Article 251 life component allocated to the life activity.[4][2]
  • Total SCR Excluding Capital Add-On: SCR amount used to allocate the notional SCR corridor before notional capital add-ons.[2]
  • Notional Non-Life Add-On: Part of any supervisory capital add-on apportioned to the non-life activity and included in the notional non-life corridor test.[2][5]
  • Notional Life Add-On: Part of any supervisory capital add-on apportioned to the life activity and included in the notional life corridor test.[2][5]
  • Notional Non-Life Absolute Floor: Absolute floor applied to the notional non-life MCR after the notional combined non-life MCR is calculated.[2][6][1]
  • Notional Life Absolute Floor: Absolute floor applied to the notional life MCR after the notional combined life MCR is calculated.[2][1]

Technical Rationale

The notional non-life linear MCR is the sum of the non-life and life components allocated to non-life activity. The notional life linear MCR is the sum of the non-life and life components allocated to life activity. Each notional linear MCR is then tested against its allocated 25%-45% SCR corridor and the relevant notional absolute floor.

Important Notes

  • Separation of MCR: Composite undertakings must maintain the notional life and non-life MCR split. The Article 129 absolute floor for the whole undertaking is the life floor plus the relevant non-life floor.
  • Default example: The example aligns with the Article 250 non-life and Article 251 life linear components, so the default notional linear total reconciles to the default Linear MCR.
  • Reporting: The displayed result is intended to support the composite-undertaking MCR calculation for the S.28.02.01 reporting view.[7]

Sources

  1. Directive 2009/138/EC - Art. 129 (Calculation of the Minimum Capital Requirement) - EIOPA
  2. Delegated Regulation (EU) 2015/35 - Art. 252 (Notional Minimum Capital Requirement for composite insurance undertakings) - EIOPA
  3. Delegated Regulation (EU) 2015/35 - Art. 250 (Linear formula component for non-life insurance and reinsurance obligations) - EIOPA
  4. Delegated Regulation (EU) 2015/35 - Art. 251 (Linear formula component for life insurance and reinsurance obligations) - EIOPA
  5. Directive 2009/138/EC - Art. 37 (Capital add-on) - EIOPA
  6. Delegated Regulation (EU) 2015/35 - Art. 253 (Absolute floor of the Minimum Capital Requirement) - EIOPA
  7. Commission Implementing Regulation (EU) 2023/894 - QRT S.28.02.01 (Minimum Capital Requirement for both life and non-life activity) - EUR-Lex

Default values are illustrative sample inputs for navigation, training, and QA. Replace them with controlled data before using the result in capital analysis, governance, or reporting decisions.