This should not lead to unduly burdensome requirements because account should be taken of the nature, scale and complexity of the operations of the undertaking. The identification of a particular function does not prevent the undertaking from freely deciding how to organise that function in practice save where otherwise specified in this Directive. The system of governance includes the risk-management function, the compliance function, the internal audit function and the actuarial function.
Conditions governing insurance business
The Member States shall require insurance and reinsurance undertakings or insurance holding companies to report on a regular basis and at least annually to the group supervisor all significant intra-group transactions by insurance and reinsurance undertakings within a group, including those performed with a natural person with close links to an undertaking in the group. Articles 236 to 242 shall apply mutatis mutandis to insurance and reinsurance undertakings which are the subsidiary of an insurance holding company. The proportional share of the Solvency Capital Requirement of the related insurance or reinsurance undertakings. The proportional share of the participating insurance or reinsurance undertaking in the own funds eligible for the Solvency Capital Requirement of the related insurance or reinsurance undertakings. The supervisory authority shall explain any decision referred to in the first and second subparagraphs to both the insurance or reinsurance undertaking and the group supervisor.
- The intra-group transactions shall be subject to supervisory review by the group supervisor.
- That information shall also contain an indication of the structure of the group concerned.
- The reorganisation and winding-up of direct insurance undertakings.
FROM WHEN DO THE RULES APPLY?
The powers with regard to insurance and reinsurance undertakings referred to in paragraphs 1 to 5 shall also be available with regard to outsourced activities of insurance and reinsurance undertakings. The financial supervision of insurance and reinsurance undertakings, including that of the business they pursue either through branches or under the freedom to provide services, shall be the sole responsibility of the home Member State. ‘diversification effects’ means the reduction in the risk exposure of insurance and reinsurance undertakings and groups related to the diversification of their business, resulting from the fact that the adverse outcome from one risk can be offset by a more favourable outcome from another risk, where those risks are not fully correlated; ‘risk-mitigation techniques’ means all techniques which enable insurance and reinsurance undertakings to transfer part or all of their risks to another party;
Mentioned in this article
- The own-risk and solvency assessment conducted at group level shall be subject to supervisory review by the group supervisor in accordance with Chapter III.
- However, the effects of any such reorganisation measures as well as winding-up proceedings vis-à-vis third countries should not be affected.
- Those specific parameters shall be calculated in such a way to ensure that the undertaking complies with Article 101(3).
- Since the objectives of this Directive cannot be sufficiently achieved by the Member States and can therefore, by reason of their scale and effects, be better achieved at Community level, the Community may adopt measures, in accordance with the principle of subsidiarity as set out in Article 5 of the Treaty.
For the purposes of points (a), (b) and (c) of paragraph 1, insurance or reinsurance operations shall be allocated to the underwriting risk module that best reflects the technical nature of the underlying risks. It shall correspond to the Value-at-Risk of the basic own funds of an insurance or reinsurance undertaking subject to a confidence level of 99,5 % over a one-year period. General provisions for the solvency capital requirement using the standard formula or an internal model The excess amount referred to in point (1) shall be reduced by the amount of own shares held by the insurance or reinsurance undertaking. When valuing liabilities under point (b), no adjustment to take account of the own credit standing of the insurance or reinsurance undertaking shall be made.
Where a dominant influence is exercised through a centralised coordination, those undertakings should be supervised in accordance with the same rules as those provided for groups constituted through capital ties in order to achieve an adequate level of protection for policy holders and a level playing field between groups. Given the increasing cross-border nature of insurance business, divergences between Member States’ regimes on special purpose vehicles, which are subject to the provisions of this Directive, should be reduced to the greatest extent possible, taking account of their supervisory structures. The particular nature of such health insurance distinguishes it from other classes of indemnity insurance and life insurance insofar as it is necessary to ensure that policy holders have effective access to private health cover or health cover taken out on a voluntary basis regardless of their age or risk profile. Any conflicts of interest arising, in particular, from the fact that the insurance undertaking is covering another person or is covering a person in respect of both legal expenses and any other class of insurance should be precluded as far as possible or resolved.
WHAT IS THE AIM OF THE DIRECTIVE?
The reorganisation measures shall be governed by the laws, regulations and procedures applicable in the home Member State, unless otherwise provided in Articles 285 to 292. The reorganisation measures shall not preclude the opening of winding-up proceedings by the home Member State. Adoption of reorganisation measures applicable law ‘competent authorities’ means the competent authorities of the home Member State. Mixed-activity insurance holding companies Without prejudice to Article 300(1) and (2) of the Treaty, the Commission shall, with the assistance of the European Insurance and Occupational Pensions Committee, examine the outcome of the negotiations referred to in paragraph 1.
The application shall state the authority of the Member State which in future is to supervise the solvency of the entire business of the branches established within the Community. In the cases referred to in point (a) of the first subparagraph, account shall be taken only of the operations effected by all the branches established within the Community for the purposes of this calculation. The Solvency Capital Requirement and the Minimum Capital Requirement shall be calculated in accordance with the provisions of Chapter VI, Sections 4 and 5. The absence of any response from the authorities consulted within that period shall be considered equivalent to a favourable opinion or tacit consent. The law of the Member State of the accepting undertaking permits such a transfer; and
Authorisation
From that sum there shall be deducted the amount of recoveries effected during the periods specified in paragraph 1. The amounts of claims paid in respect of direct business (without any deduction of claims borne by reinsurers and retrocessionaires) in the periods specified in paragraph 1 shall be aggregated. From that sum there shall then be deducted the total amount of premiums or contributions cancelled in the previous financial year, as well as the total amount of taxes and levies pertaining to the premiums or contributions entering into the aggregate. The premiums or contributions (inclusive of charges ancillary to premiums or contributions) due in respect of direct business in the previous financial year shall be aggregated. Required solvency margin for the purpose of Article 17b(3)
For non-life insurance, the Member State in which the head office of the insurance undertaking covering the risk is situated; The activity consisting in accepting risks ceded by an insurance undertaking or third-country insurance undertaking, or by another reinsurance undertaking or third-country reinsurance undertaking; or Reinsurance undertakings which by 10 December 2007 ceased to conduct new reinsurance contracts and exclusively administer their existing portfolio in order to terminate their activity shall not be subject to this Directive.
SCR property denotes the property risk sub-module, SCR equity denotes vegas casino apk the equity risk sub-module, SCR interest rate denotes the interest rate risk sub-module, Structure of the market risk module
Related undertakings of a parent undertaking of that insurance or reinsurance undertaking. Parent undertakings of that insurance or reinsurance undertaking; Related undertakings of that insurance or reinsurance undertaking; Where the group is a group without a parent undertaking, or in any circumstances not referred to in points (i) to (iv) by the supervisory authority which authorised the insurance or reinsurance undertaking with the largest balance sheet total.
The Cost-of-Capital rate used shall be equal to the additional rate, above the relevant risk-free interest rate, that an insurance or reinsurance undertaking would incur holding an amount of eligible own funds, as set out in Section 3, equal to the Solvency Capital Requirement necessary to support insurance and reinsurance obligations over the lifetime of those obligations. A material breach of the laws, regulations or administrative provisions which lay down the conditions governing authorisation or which specifically govern pursuit of the activities of insurance and reinsurance undertakings; The authorities responsible for overseeing the persons charged with carrying out statutory audits of the accounts of insurance undertakings, reinsurance undertakings, credit institutions, investment firms and other financial institutions; Member States shall require any natural or legal person who has taken a decision to dispose, directly or indirectly, of a qualifying holding in an insurance or reinsurance undertaking first to notify in writing the supervisory authorities of the home Member State, indicating the size of that person’s holding after the intended disposal.
Article 13(1) and (2), FIRST subparagraph Article 6(3) THIRD subparagraph and Article 29 SECOND subparagraph Article 8(3), THIRD subparagraph
Exchange of information with other authorities Where the information to be disclosed by a Member State to a third country originates in another Member State, it shall not be disclosed without the express agreement of the supervisory authority of that Member State and, where appropriate, solely for the purposes for which that authority gave its agreement. Professional secrecy, exchange of information and promotion of supervisory convergence Similar measures shall apply to natural or legal persons failing to comply with the notification obligation established in Article 57. Such measures may consist, for example, of injunctions, penalties against directors and managers, or suspension of the exercise of the voting rights attaching to the shares held by the shareholders or members in question. Qualifying holdings, powers of the supervisory authority
Irrespective of whether CEIOPS has been consulted, the group supervisor’s decision shall state the full reasons and shall take into account the views expressed by the other supervisory authorities concerned. The group supervisor shall forward the complete application to the other supervisory authorities concerned without delay. The supervisory authorities concerned shall do everything within their power to reach a joint decision on the application within six months from the date of receipt of the complete application by the group supervisor.
WHAT IS THE AIM OF THE DIRECTIVE?
A method by which to determine the amount of each ancillary own-fund item, in which case supervisory approval of the amount determined in accordance with that method shall be granted for a specified period of time. The amounts of ancillary own-fund items to be taken into account when determining own funds shall be subject to prior supervisory approval. Unpaid share capital or initial fund that has not been called up;
It shall include the verification on a continuous basis of the proper operation of the insurance or reinsurance business and of the compliance with supervisory provisions by insurance and reinsurance undertakings. The supervisory authorities shall refuse authorisation if the laws, regulations or administrative provisions of a third country governing one or more natural or legal persons with which the insurance or reinsurance undertaking has close links, or difficulties involved in the enforcement of those measures, prevent the effective exercise of their supervisory functions. ‘concentration risk’ means all risk exposures with a loss potential which is large enough to threaten the solvency or the financial position of insurance and reinsurance undertakings; The supervisory authorities should therefore be provided with the means of exercising group supervision and of taking appropriate measures at the level of the insurance or reinsurance undertaking where its solvency is being or may be jeopardised.