The Solvency ii
Directive
SECTION
5 - HEALTH INSURANCE
Article 204
Health insurance as
an alternative to social security
1. Member States in which
contracts covering the risks in class 2 in point A of Annex I may
serve as a partial or complete alternative to health cover provided
by the statutory social security system may require the following:
(a) that those contracts comply with the specific legal
provisions adopted by that Member State to protect the general good
in that class of insurance;
(b) that the general and special
conditions of that insurance be communicated to the supervisory
authorities of that Member State before use.
2. Member States
may require that the health insurance system referred to in
paragraph 1 be operated on a technical basis similar to that of life
insurance where all the following conditions are
fulfilled:
(a) the premiums paid are calculated on the basis
of sickness tables and other statistical data relevant to the Member
State in which the risk is situated in accordance with the
mathematical methods used in insurance;
(b) a reserve is set
up for increasing age;
(c) the insurer may cancel the
contract only within a fixed period determined by the Member State
in which the risk is situated;
(d) the contract provides that
premiums may be increased or payments reduced, even for current
contracts;
(e) the contract provides that the policyholders
may change their existing contract into a new contract complying
with paragraph 1, offered by the same insurance undertaking or the
same branch and taking account of their acquired rights.
In
the case referred to in point (e) of the first subparagraph, account
shall be taken of the reserve for increasing age and a new medical
examination may be required only for increased cover.
The
supervisory authorities of the Member State concerned shall publish
the sickness tables and other relevant statistical data referred to
in point (a) of the first subparagraph and transmit them to the
supervisory authorities of the home Member State.
The
premiums must be sufficient, on reasonable actuarial assumptions,
for insurance undertakings to be able to meet all their commitments
having regard to all aspects of their financial situation. The home
Member State shall require the technical basis for the calculation
of premiums to be communicated to its supervisory authorities before
the product is circulated.
The third and fourth subparagraphs
shall also apply where existing contracts are
modified.
SECTION 6 – INSURANCE AGAINST ACCIDENTS AT
WORK
Article 205
Compulsory insurance against
accidents at work
Member States may require that any
insurance undertaking offering, at its own risk, compulsory
insurance against accidents at work within their territories comply
with the specific provisions of their national law concerning such
insurance, except for the provisions concerning financial
supervision, which shall be the exclusive responsibility of the home
Member State.
CHAPTER III - PROVISIONS SPECIFIC TO LIFE
INSURANCE
Article 206
Prohibition on compulsory ceding
of part of underwriting
Member States shall not require life
insurance undertakings to cede part of their underwriting of
activities listed in Article 2(3) to an organisation or
organisations designated by national law.
Article
207
Premiums for new business
Premiums for new
business shall be sufficient, on reasonable actuarial assumptions,
to enable life insurance undertakings to meet all their commitments
and, in particular, to establish adequate technical
provisions.
For that purpose, all aspects of the financial
situation of a life insurance undertaking may be taken into account,
without the input from resources other than premiums and income
earned thereon being systematic and permanent in a way that it may
jeopardise the solvency of the undertaking concerned in the long
term.
CHAPTER IV
RULES SPECIFIC TO
REINSURANCE
Article 208
Finite reinsurance
1.
Member States shall ensure that insurance and reinsurance
undertakings which conclude finite reinsurance contracts or carry on
finite reinsurance activities are able to properly identify,
measure, monitor, manage, control and report the risks arising from
those contracts or activities.
2. In order to ensure that a
harmonised approach is adopted with respect to finite reinsurance
activities, the Commission may adopt implementing measures
specifying the provisions of paragraph 1 with respect to the
monitoring, management and control of risks arising from finite
reinsurance activities.
Those implementing measures designed
to amend non-essential elements of this Directive inter alia by
supplementing it, shall be adopted in accordance with the regulatory
procedure with scrutiny referred to in Article 304 (3).
3.
For the purposes of paragraphs 1 and 2 finite reinsurance means
reinsurance under which the explicit maximum loss potential,
expressed as the maximum economic risk transferred, arising both
from a significant underwriting risk and timing risk transfer,
exceeds the premium over the lifetime of the contract by a limited
but significant amount, together with at least one of the following
features:
(a) explicit and material consideration of the time
value of money;
(b) contractual provisions to moderate the
balance of economic experience between the parties over time to
achieve the target risk transfer.
Article
209
Special purpose vehicle
1. Member States
shall
allow the establishment within their territory of special purpose
vehicles, subject to prior supervisory approval.
2. In order
to ensure that a harmonised approach is adopted with respect to
special purpose vehicles, the Commission shall adopt implementing
measures laying down the following:
(a) scope of
authorisation;
(b) mandatory conditions to be included in all
contracts issued;
(c) the fit and proper requirements as
referred to in Article 42 of the persons running the special purpose
vehicle;
(d) fit and proper requirements for shareholders or
members having a qualifying holding in the special purpose
vehicle;
(e) sound administrative and accounting procedures,
adequate internal control mechanisms and risk management
requirements;
(f) accounting, prudential and statistical
information requirements;
(g) the solvency
requirements.
Those implementing measures designed to amend
non-essential elements of this Directive inter alia by supplementing
it, shall be adopted in accordance with the regulatory procedure
with scrutiny referred to in Article 304(3).
2a. Special
purpose vehicles authorised prior to the date referred to in Article
310(1) shall be subject to the law of the Member State having
authorised the special purpose vehicle. However, any new activity
commenced by such a special purpose vehicle after the date referred
to in Article 310(1) shall be subject to paragraphs 1 and
2.
TITLE III
SUPERVISION OF INSURANCE AND
REINSURANCE UNDERTAKINGS IN A GROUP
CHAPTER I
GROUP
SUPERVISION: DEFINITIONS, CASES OF APPLICATION, SCOPE AND
LEVELS
SECTION 1 - DEFINITIONS
Article
210
Definitions
1. For the purposes of this Title, the
following definitions shall apply:
(a)
"participating
undertaking" means an undertaking which is either a parent
undertaking or other undertaking which holds a participation, or an
undertaking linked with another undertaking by a relationship as set
out in Article 12(1) of Directive 83/349/EEC;
(b)
"related
undertaking" means either a subsidiary undertaking or other
undertaking in which a participation is held, or an undertaking
linked with another undertaking by a relationship as set out in
Article 12(1) of Directive 83/349/EEC;
(c)
"group" means a
group of undertakings
(i) that consists of a participating
undertaking, its subsidiaries and the entities in which the
participating undertaking or its subsidiaries hold a participation,
as well as undertakings linked to each other by a relationship as
set out in Article 12(1) of Directive 83/349/EEC; or
(ii)
that is based on the establishment, contractually or otherwise, of
strong and sustainable financial relationships among those
undertakings, and that may include mutual or mutual-type
associations, provided that:
- one of those undertakings
effectively exercises, through centralised coordination, a dominant
influence over the decisions, including financial decisions, of the
other undertakings that are part of the group; and
- the
establishment and dissolution of such relationships for the purposes
of this Title are subject to prior approval by the group
supervisor.
The undertaking exercising the centralised
coordination shall be considered as the parent undertaking, and the
other undertakings shall be considered as subsidiaries;
(d)
"group supervisor" means the supervisory authority responsible for
group supervision, determined in accordance with Article
260;
(da) "college of supervisors" means a permanent but
flexible structure for cooperation and coordination among the
supervisory authorities of the Member States concerned;
(e)
"insurance holding company" means a parent undertaking, the main
business of which is to acquire and hold participations in
subsidiary undertakings, where those subsidiary undertakings are
exclusively or mainly insurance or reinsurance undertakings, or
third-country insurance or reinsurance undertakings, at least one of
such subsidiary undertakings being an insurance or reinsurance
undertaking, and which is not a mixed financial holding company
within the meaning of Directive 2002/87/EC;
(f)
"mixed-activity insurance holding company" means a parent
undertaking, other than an insurance undertaking, a third-country
insurance undertaking, a reinsurance undertaking, a third-country
reinsurance undertaking, an insurance holding company or a mixed
financial holding company within the meaning of Directive
2002/87/EC, which includes at least one insurance or reinsurance
undertaking among its subsidiary undertakings.
2. For the
purposes of this Title, the supervisory authorities shall also
consider as a parent undertaking any undertaking which, in the
opinion of the supervisory authorities, effectively exercises a
dominant influence over another undertaking.
They shall also
consider as a subsidiary undertaking any undertaking over which, in
the opinion of the supervisory authorities, a parent undertaking
effectively exercises a dominant influence.
They shall also
consider as participation the holding, directly or indirectly, of
voting rights or capital in an undertaking over which, in the
opinion of the supervisory authorities, a significant influence is
effectively exercised.
SECTION 2 - CASES OF APPLICATION
AND SCOPE
Article 211
Cases of application of group
supervision
1. Member States shall provide for
supervision, at the level of the group, of insurance and reinsurance
undertakings which are part of a group, in accordance with this
Title.
The provisions of this Directive, which lay down the
rules for the supervision of insurance and reinsurance undertakings
taken individually, shall continue to apply to such undertakings,
except where otherwise provided under this Title.
2. Member
States shall ensure that supervision at the level of the group
applies as follows:
(a) to insurance or reinsurance
undertakings, which are a participating undertaking in at least one
insurance undertaking, reinsurance undertaking, third-country
insurance undertaking or third-country reinsurance undertaking, in
accordance with Articles 216 to 262;
(b) to insurance or
reinsurance undertakings, the parent undertaking of which is an
insurance holding company which has its head office in the
Community, in accordance with Articles 216 to 262;
(c) to
insurance or reinsurance undertakings, the parent undertaking of
which is an insurance holding company having its head office outside
the Community or a third-country insurance or reinsurance
undertaking, in accordance with Articles 263, 264 and
265;
(d) to insurance or reinsurance undertakings, the parent
undertaking of which is a mixed-activity insurance holding company,
in accordance with Article 267.
3. In the cases referred to
in points (a) and (b) of paragraph 2, where the participating
insurance or reinsurance undertaking or the insurance holding
company which has its head office in the Community is a related
undertaking of a regulated entity or a mixed financial holding
company which is subject to supplementary supervision in accordance
with Article 5(2) of Directive 2002/87/EC, the group supervisor may,
after consultation with the other supervisory authorities concerned,
decide not to carry out at the level of that participating insurance
or reinsurance undertaking or that insurance holding company the
supervision of risk concentration referred to in Article 248 or the
supervision of intra-group transactions referred to in Article 249
or both.
Article 212
Scope of group
supervision
1. The exercise of group supervision in
accordance with Article 211 shall not imply that the supervisory
authorities are required to play a supervisory role in relation to
the third-country insurance undertaking, the third-country
reinsurance undertaking, the insurance holding company or the
mixed-activity insurance holding company taken individually, without
prejudice to Article 261 as far as insurance holding companies are
concerned.
2. In the following cases, the group supervisor
may decide on a case-by-case basis not to include an undertaking in
the group supervision referred to in Article 211:
(a) if the
undertaking is situated in a third country where there are legal
impediments to the transfer of the necessary information, without
prejudice to the provisions of Article 227;
(b) if the
undertaking which should be included is of negligible interest with
respect to the objectives of group supervision;
(c) if the
inclusion of the undertaking would be inappropriate or misleading
with respect to the objectives of the group
supervision.
However, where several undertakings of the same
group, taken individually, may be excluded pursuant to point (b) of
the first subparagraph, they must nevertheless be included where,
collectively, they are of non-negligible interest.
Where the
group supervisor is of the opinion that an insurance or reinsurance
undertaking should not be included in the group supervision under
one of the cases mentioned in points (b) and (c) of the first
subparagraph, it shall ▌consult the other supervisory authorities
concerned before taking a decision.
Where the group
supervisor does not include an insurance or reinsurance undertaking
in the group supervision under one of the cases provided for in
points (b) and (c) of the first subparagraph, the supervisory
authorities of the Member State in which that undertaking is
situated may ask the undertaking which is at the head of the group
for any information which may facilitate their supervision of the
insurance or reinsurance undertaking concerned.
SECTION 3
- LEVELS
Article 213
Ultimate parent undertaking at
Community level
1. Where the participating insurance or
reinsurance undertaking or the insurance holding company referred to
in points (a) and (b) of Article 211(2) is itself a subsidiary
undertaking of another insurance or reinsurance undertaking or of
another insurance holding company which has its head office in the
Community, Articles 216 to 262 shall apply only at the level of the
ultimate parent insurance or reinsurance undertaking or insurance
holding company which has its head office in the
Community.
2. Where the ultimate parent insurance or
reinsurance undertaking or insurance holding company which has its
head office in the Community, referred to in paragraph 1, is a
subsidiary undertaking of an undertaking which is subject to
supplementary supervision in accordance with Article 5(2) of
Directive 2002/87/EC, the group supervisor may, after consultation
with the other supervisory authorities concerned, decide not to
carry out at the level of that ultimate parent undertaking the
supervision of risk concentration referred to in Article 248 or the
supervision of intra-group transactions referred to in Article 249
or both.
Article 214
Ultimate parent undertaking
at national level
1. Where the participating insurance or
reinsurance undertaking or the insurance holding company which has
its head office in the Community, referred to in points (a) and (b)
of Article 211(2), does not have its head office in the same Member
State as the ultimate parent undertaking at Community level referred
to in Article 213, Member States may allow their supervisory
authorities to decide, after consultation with the group supervisor
and that ultimate parent undertaking at Community level, to subject
to group supervision the ultimate parent insurance or reinsurance
undertaking or insurance holding company at national
level.
In such a case, the supervisory authority shall
explain its decision to both the group supervisor and the ultimate
parent undertaking at Community level.
Articles 216 to 262
shall apply mutatis mutandis, subject to the provisions set out in
paragraphs 2 to 6.
2. The supervisory authority may restrict
group supervision of the ultimate parent undertaking at national
level to one or several sections of Chapter II.
3. Where the
supervisory authority decides to apply to the ultimate parent
undertaking at national level Chapter II, Section 1, the choice of
method made in accordance with Article 218 by the group supervisor
in respect of the ultimate parent undertaking at Community level
referred to in Article 213 shall be recognised as determinative and
applied by the supervisory authority in the Member State
concerned.
4. Where the supervisory authority decides to
apply to the ultimate parent undertaking at national level Chapter
II, Section 1, and where the ultimate parent undertaking at
Community level referred to in Article 213 has obtained, in
accordance with Articles 229 or 231(5), the permission to calculate
the group Solvency Capital Requirement, as well as the Solvency
Capital Requirement of insurance and reinsurance undertakings in the
group, on the basis of an internal model, that decision shall be
recognised as determinative and applied by the supervisory authority
in the Member State concerned.
In such a situation, where the
supervisory authority considers that the risk profile of the
ultimate parent undertaking at national level deviates significantly
from the internal model approved at Community level, and as long as
that undertaking does not properly address the concerns of the
supervisory authority, that supervisory authority may decide to
impose a capital add-on to the group Solvency Capital Requirement of
that undertaking resulting from the application of such model, or,
in exceptional circumstances where such capital add-on would not be
appropriate, to require that undertaking to calculate its group
Solvency Capital Requirement on the basis of the standard
formula.
The supervisory authority shall explain such
decisions to both the undertaking and the group
supervisor.
5. Where the supervisory authority decides to
apply to the ultimate participating undertaking at national level
Chapter II, Section 1, that undertaking shall not be allowed to
introduce, in accordance with Articles 234 or 247, an application
for permission to subject any of its subsidiaries to Articles 236 to
238.
6. Where Member States allow their supervisory
authorities to make the decision referred to in paragraph 1, they
shall provide that no such decisions can be made or maintained where
the ultimate participating undertaking at national level is a
subsidiary of the ultimate participating undertaking at Community
level referred to in Article 213 and the latter has obtained in
accordance with Articles 235 or 247 permission for that subsidiary
to be subject to Articles 236 to 238.
7. The Commission may
adopt implementing measures specifying the circumstances under which
the decision referred to in paragraph 1 can be made.
Those
measures designed to amend non-essential elements of this Directive
by supplementing it shall be adopted in accordance with the
regulatory procedure with scrutiny referred to in Article
304(3).
Article 215
Parent undertaking covering
several Member States
1. Where Member States allow their
supervisory authorities to make the decision referred to in Article
214, they shall also allow them to decide to conclude an agreement
with supervisory authorities in other Member States where another
related ultimate parent undertaking at national level is present,
with a view to carrying out group supervision at the level of a
subgroup covering several Member States.
Where the
supervisory authorities concerned have concluded an agreement as
referred to in the first subparagraph of this paragraph, group
supervision shall not be carried out at the level of any ultimate
parent undertaking referred to in Article 214 present in Member
States other than the Member State where the subgroup referred to in
the first subparagraph of this paragraph is located.
2. The
provisions set out in Article 214(2) to (6) shall apply mutatis
mutandis.
3. The Commission may adopt implementing measures
specifying the circumstances under which the decision referred to in
paragraph 1 can be made.
Those measures designed to amend
non-essential elements of this Directive by supplementing it shall
be adopted in accordance with the regulatory procedure with scrutiny
referred to in Article 304(3).
 
Return to Index
Solvency ii Introduction (1) to (10)
Solvency ii Introduction (11) to (20)
Solvency ii Introduction (21) to (30)
Solvency ii Introduction (31) to (40)
Solvency ii Introduction (41) to (50)
Solvency ii Introduction (51) to (60)
Solvency ii Introduction (61) to (70)
Solvency ii Introduction (71) to (80)
Solvency ii Introduction (81) to (95)
Solvency ii Articles 1 to 10
Solvency ii Articles 11 to 20
Solvency ii Articles 21 to 30
Solvency ii Articles 31 to 39
Solvency ii Articles 40 to 49
Solvency ii Articles 50 to 62
Solvency ii Articles 63 to 71
Solvency ii Articles 72 to 85
Solvency ii Articles 86 to 99
Solvency ii Articles 100 to 125
Solvency ii Articles 126 to 142
Solvency ii Articles 143 to 159
Solvency ii Articles 160 to 173
Solvency ii Articles 174 to 203
Solvency ii Articles 204 to 215
Solvency ii Articles 216 to 233
Solvency ii Articles 234 to
262
Solvency ii Articles 263 to 298
Solvency ii Articles 300 to 313
Solvency ii ANNEX 1 to 3
Solvency ii ANNEX 4 to 5
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