The Euro- Sterling value for insurance purposes

Notes for editors

1. Under the provisions of the EC Directives on Insurance the value of the euro is fixed annually for insurance supervision purposes. These include the calculation of the required solvency margin for general insurance business and, for all insurance business, the size of the minimum guarantee fund. Insurance companies therefore need to know the sterling value of the euro to be used in these calculations, for example in completing the returns which they are required to deposit with the Financial Services Authority under the Insurance Companies Act 1982.

2. Section 96A (4) of the Act provides that the rate of conversion of the euro to apply from 31 December each year is to be its value on the latest day of the preceding October for which rates for currencies of EU member states not participating in Economic and Monetary Union were published in the Official Journal of the European Communities. This year, the date in question was 29 October 1999 when the value published was 63.93 pence. It is important to note that this rate applies from 31 December 1999 and not from 1 January 2000 and is therefore the rate to be applied in calculations carried out in respect of the 1999 calendar year end.