Category: Capital management · Reviewed by Jake Leat, Associate Director · Last reviewed
Risk-based capital
Risk-based capital (RBC) is any regulatory or rating-agency framework that scales an insurer’s required capital to the specific risks it has assumed, rather than to a flat percentage of premium or reserves. It replaced earlier “Solvency I”-style rule-of-thumb regimes from the mid-1990s onwards.
Major frameworks
Solvency II — EU and UK risk-based regime since 2016. Articulated as own funds vs SCR vs MCR.
US NAIC RBC — separate calculations for life, P&C, and health, factor-based.
Bermuda BSCR — Bermuda Solvency Capital Requirement, calibrated to a 99% one-year TVaR.
Swiss Solvency Test (SST) — risk-based regime in Switzerland, principles similar to Solvency II.
ICS (Insurance Capital Standard) — IAIS-developed global standard for IAIGs.
Our service promise. We acknowledge every quote request the same working day. For straightforward risks, indicative terms typically follow within five working days. Complex risks — higher-risk buildings, cladding, mid-term proposals requiring fresh underwriting — may take longer; we’ll send you a progress note by the end of the fifth working day in those cases.