Welcome to the FIG Top 5 at 5

On 12 March 2026, the Central Bank of Ireland (“Central Bank”) published its March 2026 Insurance Newsletter (“Newsletter”).

The Newsletter covers areas of relevance and interest to the insurance sector. Some of the matters covered in this edition include:

Results and feedback from AI survey

The Newsletter outlines that the Central Bank carried out a survey (“Survey”) to gather information on the use of generative AI systems (“Gen AI”) and other AI systems (“Other AI”) in (re)insurance. In May 2025, the European Insurance and Occupational Pensions Authority (“EIOPA”) launched a survey on the use of Gen AI – for more information, see FIG Top 5 at 5 dated 22 May 2025.

In the interests of efficiency, the Central Bank combined its own Survey and that of EIOPA. Information gathered on Gen AI was submitted to EIOPA and on 2 February 2026, EIOPA published its report on the use of Gen AI in the European insurance sector – for more information, see FIG Top 5 at 5 dated 5 February 2026.

Some of the findings of the Central Bank Survey are as follows:

• 85% of surveyed firms are using AI to some extent. Gen AI, in particular, is used by a large proportion of firms where 81% of firms have adopted it. 50% of firms use AI systems other than Gen AI systems (“Other AI”);
• a large proportion of use cases relate to the use of a digital companion aimed at achieving operational efficiencies, such as document summarisation;
• within the next three years nearly all firms (94%) will use AI systems to some extent. The Survey results signal a significant increase in the proportion of firms using Other AI with 81% of firms expect to use Other AI systems;
• firms mostly use AI systems which require human input, with a minority of firms indicating that they mostly use systems which involve a level of automation. None of this use is fully autonomous;
• lack of skilled talent presents a challenge in implementing AI, alongside costs and lack of clarity around potential use cases;
• as regards choosing how to source an AI system, firms are adopting multiple approaches; and
• in terms of governance and risk management, the Survey results indicate that firms are taking steps to manage these and other AI-driven risks, for example, 81% of firms using AI have a register of the use cases in the firm.

The Newsletter highlights that many of the risks associated with AI are not new and are already addressed by existing regulation and in that regard, the Newsletter refers to:

• the EIOPA opinion on AI governance and risk management – for more information, see FIG Top 5 at 5 dated 21 August 2025; and
• the revised consumer protection code (“CPC”), which contains specific provisions for in-scope firms who use digital technology to provide financial services.

The Newsletter highlights the importance of firms adhering to the following standards in the deployment of AI:

• strategic alignment – firms must ensure their use of AI is appropriate for the specific business challenge being addressed;
• accountability and explainability- firms should have clear accountabilities and responsibility, human oversight of decisions and their explainability;
• proportionate governance – risk management practices must be commensurate with the scale, scope and sensitivity of the AI deployment; and
• compliance – processes should be in place to ensure regulatory obligations are met.

It is emphasised that the Central Bank expects firms to ensure that AI tools strengthen, rather than undermine, their ability to price fairly, reserve adequately and treat customers appropriately.

Finally, the Newsletter emphasises the importance of firms meeting the requirements of the revised CPC and relevant aspects of the EU AI Act.

Thematic review of considerations of climate change risks in firms’ governance

The Newsletter sets out that a review (“Review”) of the appropriateness of the governance framework to manage climate change risks of a cohort of (re)insurance firms was recently completed by the Central Bank. At the outset, the Newsletter highlights the importance of the Central Bank’s 2023 guidance for (re)insurance undertakings on climate change risk (“Guidance”), further emphasising that the Guidance is grounded in legislative requirements established under the Solvency II framework.

Some of the matters highlighted in this section of the Newsletter are as follows:

• firms need to be aware of incoming new requirements on sustainability risk plans under the Solvency II amending directive and must plan accordingly to ensure compliance;
• the results of the Review show that there are varying levels of maturity regarding the consideration of climate change risks in governance and risk management frameworks;
• most firms, subject to the Review, have made some efforts to meet the requirements outlined in the Guidance. However, scope for significant improvement remains;
• the Central Bank expects (re)insurers’ boards, committees and senior management to understand and appropriately manage the risks that climate change poses to their firms, including the strategic decision making of the local entity;
• in some cases, concentration of the climate change knowledge rested on a few members of the board or senior management, posing key person risk, a broader spread of knowledge is encouraged;
• firms should consider what steps they can implement to reduce their reliance on group for climate change initiatives and goals;
• the roles and responsibilities related to climate change risks should be clearly identified, documented and understood by (re)insurers, with the Newsletter outlining stronger and weaker practices in this regard;
• the Central Bank expects that a firm’s remuneration policy is consistent with the objectives of the (re)insurer’s business and risk strategy, corporate culture and values in relation to climate change risk;
• the Central Bank encourages (re)insurers to continue to ensure that an appropriate governance framework is in place in order to manage climate change risks effectively; and
• the Central Bank will continue to monitor the progress of integration of climate change risks into the (re)insurers’ risk management and governance frameworks, business models and strategy, with the Newsletter highlighting that this intention is reflected in the recently published Regulatory and Supervisory Outlook Report (“RSO”) – for more information, see FIG Top 5 at 5 dated 5 March 2025.

Solvency II and IRRD

The Newsletter contains relevant updates on the changes as a result of the Solvency II regime and the Insurance Recovery and Resolution Directive (“IRRD”) and also outlines the Central Bank’s implementation plans. The Newsletter also states the Central Bank’s intention to engage with industry regarding the changes, specifically at a planned industry event during the summer targeted at supporting insurance undertakings in preparing for the changes.

As regards Solvency II, the Newsletter notes the publication of the Level II Delegated Acts in the Official Journal of the EU, applicable from 30 January 2027. Some further matters addressed in the Newsletter include the following:

• there will be no phasing-in of the interest-rate shock in the standard formula solvency capital requirement;
• EIOPA’s recent publication of updated guidelines on the supervisory review process and the treatment of market and counterparty risk exposures in the Standard Formula;
• it is highlighted that the Central Bank expects further consultations from EIOPA during the year on guidelines that have not been impacted by the Solvency II review, these will be focused on streamlining rather then technical changes;
• an update on the industry survey that was issued by the Central Bank on 3 March 2026 aimed at assisting firms as regards preparation for the Solvency II regulation changes and providing the Central Bank with essential data for planning and risk assessment purposes. A potential pre-application assessment process for firms that are not SNCUs is also addressed; and
• an update on the Central Bank’s compatibility review of its Solvency II requirements and guidance documentation, highlighting that phase one is currently underway and that updates to the revised documents will be communicated to industry as they are completed. Additionally, the Newsletter highlights that the Central Bank plans to consult with industry in Q2 2026 regarding its review of the domestic actuarial regime and related governance requirements.

Regarding IRRD, some of the matters highlighted in the Newsletter include the following:

• EIOPA’s publication of the first set of technical standards and guidelines – for more information see, FIG Top 5 at 5 dated 19 February 2026. The Newsletter also highlights that the third batch of instruments for public consultation is due to be published by EIOPA in July; and
• the 2021 recovery planning regulations will be reviewed in light of IRRD, aimed at ensuring that Ireland’s framework complements, rather than duplicates, the EU regime.

Insurance Updates

In this section of the Newsletter, the Central Bank provides a number of updates on varying matters, some of which are as follows:

• the launch of a number of sector specific AML / CFT risk evaluation questionnaires (“REQs”), specifically highlighting the launch of a sector specific REQ for life insurers – the first submission is due by 11 September 2026. The Newsletter directs interested parties to detailed guidance and an example of a completed return that has been published on the Central Bank’s website. Additionally, the Central Bank will host a workshop on 16 April 2026 aimed at assisting in the completion of the new REQ, particularly from a technical perspective;
• an update on the submission of registers of information under DORA and the planned data quality checks to be carried out by the European Banking Authority – for more information, see FIG Top 5 at 5 dated 26 February 2026;
• sustainability updates, referencing a recent speech by Governor Makhlouf at the Climate Risk and Sustainable Finance Forum and the recent publication of the climate observatory – for more information, see FIG Top 5 at 5 dated 11 December 2025 and FIG Top 5 at 5 dated 29 January 2026, respectively;
• the publication of the RSO; and
• the consultation on prohibition notices under the fitness and probity regime – for more information, see FIG Top 5 at 5 dated 29 January 2026.

On 13 March 2026, the Central Bank of Ireland (“Central Bank”) published a consultation paper (“CP167”) on the methodology for calculating contributions to the deposit guarantee scheme (“DGS”).

CP167 sets out that the Central Bank is proposing to change the method, as to how annual contributions to the DGS are calculated, from the current “flow-based” approach to a “stock-based” approach. It is planned that this change will take effect in Q3 2026. This comes on foot of a review of the 2016 European Banking Authority (“EBA”) guidelines on methods for calculating contributions to deposit guarantee schemes and a 2022 public consultation by the EBA which resulted in new guidelines being issued. These new guidelines have been in effect since 3 July 2024. Amongst other matters, the updated guidelines detail the application of an alternative stock-based approach to calculating contributions, which takes account of member institutions’ past contributions

Stock-based approach

The proposed stock-based approach takes account of each member institution’s past contributions cumulatively when deciding if further contributions are required. This is targeted at making contribution requests more proportionate for member institutions, given that the stock-based approach can now be used under the EBA methodology and that the funds held in Irish DGS has reached its minimum target level of 0.8% of covered deposits in the State.

CP167 highlights that a member institution’s contribution that is calculated using the stock-based approach will more closely reflect changes in its risk profile and the level of covered deposits it holds. This approach also introduces the possibility that a member institution’s past contributions could place it in credit against future contributions.

The proposed stock-based approach does not affect depositors’ protection.

Minimum target level

CP167 points out that the DGS fund’s minimum target level will remain at 0.8% of total covered deposits, confirming that the Central Bank will only collect the amount required to meet that target. The calculation of an institution’s risk weighting will remain the same.

Risk-weighted

CP167 highlights that not all member institutions will be required to contribute in every cycle when funding is required. If contributions are required to maintain the DGS fund’s 0.8% minimum target level, contributions will be sought, initially, from those member institutions that have, to date, contributed the lowest proportion of their risk‑weighted covered deposits. Accordingly, firms that, under the flow-based approach, have contributed more than their risk weighted covered deposits will not be required to contribute in the first instance.

Next Steps

The Central Bank welcomes industry views on the proposals set out in CP167 and on the specific implementation of the new approach. Feedback can be submitted until 17 April 2026

On 13 March 2026, the European Insurance and Occupational Pensions Authority (“EIOPA”) launched a discussion paper (“Paper”) aimed at gathering feedback from stakeholders as to potential inefficiencies, overlaps and inconsistencies in regulatory reporting and disclosure requirements. The Paper also seeks feedback on possible solutions to address any identified issues.

Background

Under the amended Solvency II directive, EIOPA is required to submit a report to the European Commission (“Commission”) that assesses potential measures, legislative and technical, to develop an integrated data collection system for the insurance and pensions sectors. EIOPA has stated that the initiative is in line with its efforts to reduce administrative burden for both supervisors and undertakings and also reflects the fact that well-structured, reusable data is seen as a strategic asset in EIOPA’s 2030 strategy – for more information, see FIG Top 5 at 5 dated 22 January 2026.

Current situation

The Paper considers both the insurance and institutions for occupational retirement provisions (“IORPs”) noting that, currently, the insurance sector has a well-harmonised reporting system based on Solvency II, whereas, IORPs reporting is more fragmented.

Focus areas

The Paper particularly focuses on the collection of derivatives and fund look-through data, including the potential for simplification and harmonisation of reporting requirements for collective investment undertakings. The potential use of existing data sources, such as EMIR, to reduce reporting requirements, is also explored.

Potential improvements

Some of the potential areas for improvement, identified by EIOPA in the Paper, are as follows:

• aligning concepts and standards;
• reusing and exchanging collected information; and
• modernising IT systems to support automated reporting practices.

The Paper highlights that combining data from datasets exchanged between supervisory authorities can reduce duplication but that such action requires careful governance that takes account of security, confidentiality and interoperability considerations, together with due attention to potential legal constraints.

Next Steps

EIOPA invites stakeholder feedback on the paper. Such feedback, which can be submitted until 10 June 2026, will inform the development of EIOPA’s final report on the matter.

On 12 March 2026, the European Securities and Markets Authority (“ESMA”) published a report (“Report”) on its call for evidence (“CfE”) on the retail investor journey, specially focused on understanding retail participation in capital markets.

ESMA launched the CfE in May 2025 – for more information, see FIG Top 5 at 5 dated 29 May 2025. The CfE particularly sought feedback on the MiFID II regulatory requirements that impact retail investors when engaging with capital markets.

The Report provides a high-level summary of the responses received regarding the areas addressed in the CfE. The Report highlights that it does not present final positions, policy recommendations or draft proposals. Instead, the Report aims to facilitate further dialogue and to guide the next stages of analysis.

The feedback received on foot of the CfE shows that there is no single obstacle in the investor journey. Instead, the responses point to multiple factors, both regulatory and non-regulatory, that, when combined, may create barriers when it comes to people deciding whether to invest.

The Report sets out a number of potential technical actions and operational improvements that ESMA will explore in light of the feedback received from the CfE. These actions and improvements are focused on making it easier for retail investors to access suitable investment opportunities, particularly addressing simplification and information overload.

Some of the suggestions as to how ESMA will use the feedback received are as follows:

• to shape future technical advice on the MiFID II delegated acts, aimed at improving MiFID level 2 requirements, as appropriate;
• streamlining disclosure requirements and dealing with information overload, by, for example, calibrating periodic reporting so that quarterly statements are provided only to clients without access to near real-time information online / advocating for a digital-first approach for information on key firm policies;
• reducing the complexity as regards suitability and appropriateness, while maintaining investor protection by, for example, further streamlining the collection and regular update of client information for suitability assessments, avoiding unnecessary updates where no material change has occurred; and
• simplifying and improving the MiFID II requirements on sustainability, including, reducing operational complexity in the entire cycle of collection, adaptation and update of client sustainability preferences / supporting financial education efforts on relevant sustainability topics / simplifying the definition of “sustainability preferences”.

 

Retail Investment Strategy

In terms of future technical advice on the MiFID II delegated acts, the Report emphasises that  this will be determined by the content of the retail investment strategy (“RIS”) and the mandates provided by the European Commission. The Report specifically acknowledges that political agreement has been reached on the RIS and highlights that the Report is not intended to interfere with, or duplicate, the legislative process in that regard.

1. AMLA launches data collection exercise to test risk assessment models

On 16 March 2026, the EU’s Authority for Anti-Money Laundering and Countering the Financing of Terrorism (“AMLA”) published a press release (“Press Release”) announcing the publication of the reporting package for its data collection and testing exercise (“Exercise”) as regards  risk assessment models for the financial sector.

AMLA has stated that the Exercise is aimed at:

• informing the selection, set to take place in 2027, of up to 40 entities that will be directly supervised by AMLA from 2028; and
• ensuring that money laundering risks, as regards credit and financial institutions, are consistently assessed by supervisors across the EU.

The published reporting package consists of:

• an interpretive note (“Note”) that provides a structured and operational representation of the reporting obligations for the Exercise, particularly arising from the draft regulatory technical standards (“RTS”) under article 12(7) of regulation (EU) 2024/1620 (“AMLAR”) and the draft RTS under article 40(2) of directive (EU) 2024/1640 (“AMLD VI”). The Note translates the legal requirements into reporting templates, datapoint descriptions and practical instructions, with a view to supporting correct and consistent implementation by reporting obliged entities and national financial supervisors; and
• a template, in the form of an Excel spreadsheet.

ALMA has also published a recorded webinar that explains the reporting requirements and next steps. Participants in the Exercise have already been notified by their national supervisors.

In developing the reporting package, the AMLA explains that it worked closely with national supervisors and with the entities selected to participate in the Exercise.

The AMLA has highlighted that high quality data from the private sector is essential when to comes to building a reliable selection model and a common EU-wide risk assessment methodology. Additionally, the Exercise will allow the participating institutions to test and prepare their systems for future data collections, while allowing AMLA to use the insights gained to optimise the data collection planned for the selection process.

Next Steps

Participating institutions are required to submit their data by 22 April 2026. The Note sets out that an updated package will be issued for the 2027 reporting cycle and the real selection exercise, and the general 2028 reporting cycle. The updated package will contain insights gathered from the Exercise, technical improvements identified during implementation and the final exchange and submission format to AMLA.

2. Eurosystem publishes Appia roadmap and feedback questionnaire for Europe’s tokenised finance

On 11 March 2026, the European Central Bank (“ECB”) published a press release (“Press Release”) announcing the publication, by the Eurosystem, of the roadmap (“Roadmap”) for Appia – described in the Press Release as “a strategic initiative to shape the development of a European tokenised financial ecosystem in which central bank money continues to play a central role.”

Appia aims to bring the Eurosystem and public and private sector stakeholders together to build integrated, innovative and resilient tokenised wholesale financial markets in Europe.

The Press Release highlights that tokenisation and distributed ledger technology (“DLT”) have the potential to improve efficiency in wholesale financial markets by allowing multiple steps of an asset’s life cycle to be bundled on a single platform. Additionally, tokenisation allows for smart contracts that enable a large range of innovative solutions.

Background

Between May and November 2024, the Eurosystem engaged in exploratory work regarding new technologies for wholesale central bank money settlement, culminating in the ECB’s governing body approving a plan to transform the findings of the exploratory stage into a strategy in June 2025. Part of this strategy consists of Appia.

Objectives

With Appia, the Eurosystem seeks to leverage DLT in pursuit of the following objectives:

• to ensure the effectiveness of monetary policy and financial stability and the smooth functioning of payment systems by maintaining central bank money as the anchor of a two tier monetary system;
• to foster a more integrated, competitive and innovative payments and securities ecosystem through efficient infrastructures for financial markets;
• to support strategic autonomy and increased resilience; and
• to ensure the relevance of the euro as an international currency.

Bearing such objectives in mind, the Eurosystem will explore ways to support the development of DLT networks that function as basic infrastructures, establishing European governance and using common standards.

Some further matters highlighted in the Roadmap are as follows:

• using a combination of analytical and practical work, the Eurosystem will assess possible DLT network configurations under different scenarios;
• with Appia, the Eurosystem aims to develop a blueprint for a future long-term solution by 2028, in cooperation with both public sector and market stakeholders; and

 

• during the duration of the Appia analysis, market participants will already be able to settle DLT-based transactions in central bank money through Pontes – which is the Eurosystem’s DLT solution that will be launched in Q3 2026 to enable central bank money settlement for DLT-based transactions.

The Roadmap highlights that shared infrastructures based on common standards could help reduce fragmentation, lower barriers to entry and support competition and innovation across Europe’s financial markets.

Feedback questionnaire

The Eurosystem has also published a feedback questionnaire (“Questionnaire”) seeking input from public and private sector stakeholders on the approach set out in the Roadmap and to express interest in contributing to the upcoming analytical and practical work. The feedback received will further inform work and the Appia blueprint.

Feedback can be submitted until 22 April 2026

Next Steps

Feedback received on foot of the Questionnaire will be taken into account by the Eurosystem to refine the conceptual basis for the analysis and to plan analytical and practical work, including the selection of external partners in these activities and in market engagement structures to be established for Appia.