1.To assess whether one or several risk modules or sub-modules meet the conditions set out in Article 109(2) and (3) of Directive 2009/138/EC, insurance and reinsurance undertakings shall calculate each of such modules or sub-modules separately.
For the purposes of the first subparagraph, insurance and reinsurance undertakings may use a simplified calculation, provided that they comply with Article 88 and 89 of this Regulation, but not for the market risk module or any risk sub-module within that risk module.
2.Where one or several risk modules or sub-modules, other than the market risk module or any risk sub-module within the market risk module, meet the conditions set out in Article 109(2) and (3) of Directive 2009/138/EC, the value of each of such risk modules or sub-modules may be calculated, for each reference date no later than three years from the reference date of the calculation referred to in paragraph 1 of this Article, as follows:
\mathrm{SCR}_{t}^{k} = \max \left(\mathrm{SCR}_{0}^{k}; f^{k} \cdot \mathrm{Volume}_{t}^{k}\right)
where:
\mathrm{SCR}_{t}^{k}
denotes the solvency capital requirement for a given risk-module or sub-module k which meets the conditions set out in Article 109(2) of Directive 2009/138/EC, at the reference date t;
\mathrm{SCR}_{0}^{\mathrm{k}}
denotes the outcome of the calculation of the risk-module or sub-module k, referred to in paragraph 1;
\mathrm{Volume}_{t}^{k}
denotes the undertaking-specific volume measure for the risk module or sub-module k, at the reference date t;
f k denotes the risk factor for the risk module or sub-module k, calculated in accordance with paragraph 3.
For the purposes of the first subparagraph, point (c), the insurance or reinsurance undertaking shall justify, to the satisfaction of the supervisory authority, the appropriateness of the undertaking-specific volume measure used.
3.The risk factor referred to in paragraph 2, first subparagraph, point (d), shall be calculated as follows:
f^{k} = \frac{\mathrm{SCR}_{0}^{k}}{\mathrm{Volume}_{0}^{k}}
where
\mathrm{Volume}_{0}^{\mathrm{k}}
denotes the undertaking-specific volume measure for the risk module or sub-module k, at the reference date of the calculation of paragraph 1.