Non-Life Aviation Risk

Overview

This calculator implements the gross capital requirement for the Aviation Catastrophe Risk sub-module within the Solvency II Non-Life Underwriting standard formula.^[1] The Aviation Risk requirement is defined as the economic capital necessary to cover the loss in basic own funds resulting from an extreme, low-frequency 1-in-200 year aviation-catastrophe event.^[2]

Input Terms

• Sum Insured (Largest Aircraft): The total value of property and liability exposure for the undertaking's largest single insured aircraft.^[1]
• Scenario Severity: The requirement is derived from the maximum loss across several prescribed aviation scenarios, including mid-air collision, hull destruction, and large-scale liability claims.

Technical Rationale

The Aviation Catastrophe Risk sub-module is calibrated to a 99.5% confidence level over a one-year horizon. It captures the sensitivity of the undertaking’s basic own funds to extreme aviation events, such as a major passenger plane crash or the destruction of a high-value hull and its associated liability.^[1]

The calculation identifies the largest single-aircraft exposure and applies several catastrophe scenarios. This ensures that the undertaking holds enough capital to absorb the maximum possible loss from a single aviation tragedy. The final result represents the gross aviation catastrophe component before diversification in Man-made Catastrophe Risk.

Important Notes

• Scenario evidence gate: Prepared catastrophe scenario amounts must carry source evidence for both scenario inputs. The selected maximum remains visible, while the governance-breach output flags unsupported scenario preparation.
• Concentration Risk: The requirement is highly sensitive to the undertaking's single largest aviation hull and liability exposure.
• Gross vs. Net SCR: This calculator determines the standalone Non-Life Aviation Risk SCR. Solvency II risk is only finalized as a net impact on Basic Own Funds after diversification in Non-Life Risk, then within BSCR, and after the top-level LAC TP and LAC DT adjustments.
• Regulatory deviation: Material deviation from standard-formula assumptions at this layer may support a capital add-on or a move toward an internal model where justified.^[3]
• Reporting: The displayed result is intended to support the corresponding standard-formula component feeding the S.25.01.01 standard-formula reporting view.^[4]