OpenChainGraph Chain · Cluster ⑰ · Insurance, Actuarial & Prudential

Solvency II Reconciliation & Capital

Three-node chain covering Solvency II capital adequacy and the SII↔IFRS 17 dual-framework reconciliation. Computes SCR/MCR coverage ratios and tiering compliance, bridges technical provisions against IFRS 17 insurance contract liabilities, and scores overall insurance reporting readiness A–F. Each stage produces a tamper-evident SHA-256 execution hash.

Solvency II SCR / MCR SII ↔ IFRS 17 Del. Reg. 2015/35 3 nodes §16 Proof Candidate W3C VC §13.11 v0.5.0

Chain summary

Solvency II (EU Directive 2009/138/EC) and IFRS 17 use structurally different liability measurement bases: SII technical provisions (BEL + risk margin, RFR+UFR discount) vs IFRS 17 insurance contract liabilities (FCF + RA + CSM, locked-in rate). This chain validates SII capital ratios and tiering limits, quantifies the cross-framework bridge delta (flagging EIOPA benchmark breaches), and produces an A–F readiness grade. Node ART-180 is a §16 proof candidate — optional eddsa-jcs-2022 signature available. Nodes: ART-180 → ART-181 → ART-182.

★ terminal node · purple bar = §16 proof opt-in · gold border = export

Stage 1 — SCR/MCR Ratio Calculation (§16 proof candidate)

calculate_solvency2_scr_ratio · ART-180

Calculate SCR and MCR coverage ratios, Tier-1/2/3 own-funds eligibility limits (Del. Reg. 2015/35 art. 82–85: T1 unrestricted ≥50% SCR, T1 total ≥80% SCR, T3 ≤15% SCR), and capital breach flags. §16 eddsa-jcs-2022 signature opt-in available on this node.

→ Open tool

MCP tool: calculate_solvency2_scr_ratio

{
  "tool": "calculate_solvency2_scr_ratio",
  "arguments": {
    "capital": {
      "eligible_own_funds": 1500,
      "tier1_unrestricted": 800,
      "tier1_restricted": 200,
      "tier2": 400,
      "tier3": 100,
      "scr": 1000,
      "mcr": 250
    }
  }
}

Stage 2 — SII↔IFRS 17 Reconciliation Bridge

reconcile_sii_ifrs17 · ART-181

Bridge Solvency II technical provisions (BEL + risk margin) against IFRS 17 insurance contract liabilities (FCF + RA + CSM). Computes bridge delta, ±10% relative tolerance, BEL/FCF delta, RM/RA delta. Flags SII_RA_BELOW_EIOPA_BENCHMARK when RA/RM ratio < 57% (life EIOPA benchmark). Receives execution hash from stage 1.

→ Open tool

MCP tool: reconcile_sii_ifrs17

{
  "tool": "reconcile_sii_ifrs17",
  "arguments": {
    "provisions": {
      "sii_best_estimate": 10000,
      "sii_risk_margin": 1000,
      "ifrs17_fcf": 9800,
      "ifrs17_ra": 700,
      "ifrs17_csm": 300
    }
  }
}

Stage 3 — Insurance Reporting Readiness Diagnostic (terminal)

run_insurance_reporting_fit · ART-182

A–F readiness grade across six binary dimensions: IFRS 17 measurement model elected, CSM system implemented, RA disclosed, SII QRT reporting complete, SII/IFRS17 reconciliation done, and ICS assessed. Returns readiness_grade, readiness_score (0–100), fully_ready, and gaps[]. Final stage — exportable as Policy Mandate JSON or W3C VC.

→ Open tool

MCP tool: run_insurance_reporting_fit

{
  "tool": "run_insurance_reporting_fit",
  "arguments": {
    "entity": {
      "ifrs17_measurement_model_elected": true,
      "csm_system_implemented": true,
      "risk_adjustment_disclosed": true,
      "sii_qrt_reporting_complete": true,
      "sii_ifrs17_reconciliation_done": true,
      "ics_assessed": false
    }
  }
}

Full Chain MCP Sequence

Run all three tools in order. Each result's execution_hash feeds as parent_hash to the next call, forming the tamper-evident audit chain.

Full chain — 3 MCP calls

// Step 1: calculate SCR/MCR ratios and tiering
const step1 = await mcp.call("calculate_solvency2_scr_ratio", {
  capital: {
    eligible_own_funds: 1500,
    tier1_unrestricted: 800,
    tier1_restricted: 200,
    tier2: 400,
    tier3: 100,
    scr: 1000,
    mcr: 250
  }
});

// Step 2: bridge SII TP vs IFRS 17 ICL (chain from step 1)
const step2 = await mcp.call("reconcile_sii_ifrs17", {
  provisions: {
    sii_best_estimate: 10000,
    sii_risk_margin: 1000,
    ifrs17_fcf: 9800,
    ifrs17_ra: 700,
    ifrs17_csm: 300
  }
});

// Step 3: run readiness diagnostic — final stage
const step3 = await mcp.call("run_insurance_reporting_fit", {
  entity: {
    ifrs17_measurement_model_elected: true,
    csm_system_implemented: true,
    risk_adjustment_disclosed: true,
    sii_qrt_reporting_complete: true,
    sii_ifrs17_reconciliation_done: step2.bridge_within_tolerance,
    ics_assessed: false
  }
});

// Terminal artifact
console.log("Readiness grade:", step3.readiness_grade);
console.log("Gaps:", step3.gaps);
console.log("SCR coverage:", step1.scr_coverage_ratio + "%");
console.log("Bridge within tolerance:", step2.bridge_within_tolerance);

Chain Metadata

Chain slug	solvency-ii-reconciliation-and-capital
Nodes	art-180 → art-181 → art-182
Cluster	⑰ Insurance, Actuarial & Prudential
Regulation	Solvency II Dir. 2009/138/EC · Del. Reg. 2015/35 · IFRS 17 · IAIS ICS
Spec version	0.5.0
§16 proof	Opt-in on ART-180 (eddsa-jcs-2022, ephemeral did:key)
Terminal export	Policy Mandate JSON · W3C VC (§13.11)
Hash scheme	SHA-256 over JCS-canonical {policy_parameters, output_payload}