EIOPA Seeks Input on Solvency II NatCat Insurance Adaptation Measures

EIOPA is seeking public input on how adaptation measures for natural catastrophes (NatCat) should be prudentially treated under the Solvency II framework. The consultation paper explores whether a dedicated treatment within the Solvency II standard formula is justified to better reflect the risk mitigation provided by adaptation measures, such as flood-resistant construction, and to address the significant insurance protection gap for natural catastrophes in Europe. Key areas of focus include the risk sensitivity, materiality, and proportionality of potential new prudential treatments.

Regulated entities, particularly insurers, are invited to provide feedback on the consultation paper by April 17, 2026. The feedback will inform EIOPA's assessment of whether to propose changes to the Solvency II framework to incentivize insurers to incorporate adaptation measures into their underwriting and pricing strategies. This could lead to revised capital requirements or calibration of the standard formula, impacting how insurers assess and price NatCat risks.