PRA: Final Notice: UK Insurance Limited

PRA has fined the firm, a subsidiary and principal underwriter of Direct Line Group and now part of Aviva plc, £10,625,000 in connection with a miscalculation of their Solvency II balance sheet during 2023 and 2024. This resulted in the firm overstating its solvency to the PRA and to the market.  The miscalculation arose due to ineffective preventative and detective controls and resourcing issues in the firm’s finance and actuarial functions and went undetected by Direct Line Group’s internal controls for a significant period of time.   PRA notes that this is the first time the Early Account Scheme has been used – the firm made early admissions and agreed to resolve the matter, thereby qualifying for a 50% enhanced reduction of the fine.