What does PRA's "PS17/25 – Matching Adjustment Investment Accelerator" change?

The MAIA framework introduces the following regulatory requirements: Permission and Eligibility Framework - Firms must obtain explicit MAIA permission from the PRA to use the accelerator - Permission grants authority to regularize previously non-compliant MA assets and apply MA to new eligible assets within defined parameters Exposure Limits - Firms receive fixed monetary exposure limits calibrated using the Best Estimate of Liabilities (BEL) of the MA portfolio, net of reinsurance, at the time of permission grant - Limits remain fixed until the next formal variation of MAIA permission Asset Eligibility and Assessment - Firms must apply a proportionate, risk-based approach to assessing asset eligibility, with more in-depth assessment required for assets involving greater judgment - Assets previously rejected by the PRA in MA applications or withdrawn due to eligibility concerns should be assumed ineligible in most cases Policy Requirements - Firms must implement and maintain a MAIA policy documenting their approach to asset eligibility, governance, and risk management - Firms must develop contingency plans for scenarios where MAIA assets are determined ineligible, with the PRA expecting firms to determine appropriate review frequencies Reporting and Disclosure - Annual MAIA use report required, submitted no later than 18 weeks after financial year-end - Updates to the Matching Adjustment Asset and Liability Information Return (MALIR) reporting template - Reports must address compliance with MAIA policies, issues encountered, and pipeline of prospective applications Breach and Remediation - Firms breaching MAIA rules (MA eligibility conditions, exposure limits, regularization timescales) must rectify within two months to avoid penalties - Failure to restore compliance triggers a 10% reduction in MA benefit across the MA portfolio, increasing by 10 percentage points for each additional month of non-compliance - The PRA may revoke MAIA permission entirely if breaches indicate broader governance or risk management failures Stress Testing - Firms must regularly conduct stress tests considering implications of all MAIA assets being determined ineligible and include results in their Own Risk and Solvency Assessment (ORSA)

*Primary Scope: PRA-regulated insurers duration insurance liabilities eligible for matching adjustment treatment Firms currently using matching adjustment or considering its application *Secondary Impact: Internal audit and compliance functions (policy implementation, monitoring) Risk management teams (stress testing, contingency planning) Finance and reporting functions (MALIR template updates, annual reporting)

What should firms consider doing?

*Immediate (Q4 2025 - Q1 2026): *Assess eligibility for MAIA permission by reviewing current MA portfolio and prospective assets *Develop MAIA policy documenting asset eligibility criteria, governance structure, and risk management approach *Establish contingency plans for scenarios where MAIA assets become ineligible *Prepare MAIA permission application if pursuing the framework *Review and update MI, reporting, and control capabilities to support MAIA compliance

🇬🇧 PRA Policy Statement high

PS17/25 – Matching Adjustment Investment Accelerator

Published 23 October 2025 | United Kingdom

AI Analysis

PS17/25 establishes the **Matching Adjustment Investment Accelerator (MAIA) framework**, enabling PRA-regulated insurers to regularize and expand their use of matching adjustment (MA) in calculating capital requirements for certain long-duration insurance liabilities. This framework is significant because it provides a structured pathway for firms to optimize capital efficiency while maintaining prudential safeguards through exposure limits, eligibility assessments, and breach remediation mechanisms.

Key dates

27 October 2025: - PS17/25 final rules and policy material took effect; firms could begin applying for MAIA permission
31 December 2026 Deadline: - Implementation deadline for changes to MALIR reporting template
18 weeks after financial year Deadline: end; - Annual MAIA use report submission deadline (ongoing, annually)
2 months from breach identification Deadline: - Deadline to rectify breaches to avoid MA benefit reduction

Suggested considerations

*Immediate (Q4 2025 - Q1 2026):
*Assess eligibility for MAIA permission by reviewing current MA portfolio and prospective assets
*Develop MAIA policy documenting asset eligibility criteria, governance structure, and risk management approach
*Establish contingency plans for scenarios where MAIA assets become ineligible
*Prepare MAIA permission application if pursuing the framework
*Review and update MI, reporting, and control capabilities to support MAIA compliance

What changed

The MAIA framework introduces the following regulatory requirements: Permission and Eligibility Framework
Firms must obtain explicit MAIA permission from the PRA to use the accelerator
Permission grants authority to regularize previously non-compliant MA assets and apply MA to new eligible assets within defined parameters Exposure Limits
Firms receive fixed monetary exposure limits calibrated using the Best Estimate of Liabilities (BEL) of the MA portfolio, net of reinsurance, at the time of permission grant
Limits remain fixed until the next formal variation of MAIA permission Asset Eligibility and Assessment
Firms must apply a proportionate, risk-based approach to assessing asset eligibility, with more in-depth assessment required for assets involving greater judgment

Compliance impact

Urgency: HIGH

Who is affected

*Primary Scope:
PRA-regulated insurers
duration insurance liabilities eligible for matching adjustment treatment
Firms currently using matching adjustment or considering its application
*Secondary Impact:
Internal audit and compliance functions (policy implementation, monitoring)
Risk management teams (stress testing, contingency planning)
Finance and reporting functions (MALIR template updates, annual reporting)

*Basel 3.1 Integration
*Industry Commentary
*Regulatory Expectations
*Related PRA Publications
PS17/23
Established the foundational matching adjustment framework and FRTB requirements

References

AI-generated analysis. May contain errors or omissions — verify with the original PRA source before acting. Full disclaimer.

What the PRA said

Policy statement 17/25

Published by PRA . Read the full notice at the source for the authoritative text.

Sectors

Insurance & Pensions Capital Markets & Trading

Topics

Prudential / Capital Requirements Reporting & Disclosure Operational Resilience / Outsourcing

Relevant Firm Types

Insurance

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