The Solvency ii
Directive
(41) As a matter
of principle, the new risk-based approach
does not comprise the concept of quantitative investment limits and
asset eligibility criteria.
It should however be
possible to introduce investment limits and asset eligibility
criteria to address risks which are not adequately covered by a
sub-module of the standard formula.
(41a) In accordance with
the risk-oriented approach to the Solvency Capital Requirement it
should be possible, in specific circumstances,
to use partial or full internal models
for the calculation of that requirement instead of the standard
formula.
In order to provide
policyholders and beneficiaries with an equivalent level of
protection, such internal models should be subject to prior
supervisory approval on the basis of harmonised processes and
standards.
(42) When the amount of eligible basic own funds
falls below the Minimum Capital Requirement, the authorisation of
insurance and reinsurance undertakings should be withdrawn, if those
undertakings are unable to re-establish the amount of eligible basic
own funds at the level of the Minimum Capital Requirement within a
short period of time.
(43) The
Minimum Capital Requirement should ensure a minimum level below
which the amount of financial resources should not fall.
It is necessary that it is calculated in
accordance with a simple formula, which is subject to a defined
floor and cap based on the risk-based Solvency Capital Requirement
in order to allow for an escalating ladder of supervisory
intervention, and that it is based on the data which can be audited.
(44) Insurance and reinsurance undertakings should have assets
of sufficient quality to cover their overall financial requirements.
All investments
held by insurance and reinsurance undertakings should be managed in
accordance with the "prudent person" principle.
(45)
Member States should not require insurance and reinsurance
undertakings to invest their assets in particular categories of
assets, as such a requirement could be incompatible with the
liberalisation of capital movements provided for in Article 56 of
the Treaty.
----------------------------------------------------------------------------------------------------------------------------
[Note: They mean the Treaty establishing the European Community
(Amsterdam consolidated version) - Part Three: Community policies -
Title III: Free movement of persons, services and capital - Chapter
4: Capital and payments - Article 56 - Article 73b - EC Treaty
(Maastricht consolidated version)
Article 56
1.
Within the framework of the provisions set out in this Chapter,
all restrictions on the movement of
capital between Member States and between Member States and third
countries shall be prohibited.
2. Within the framework
of the provisions set out in this Chapter, all restrictions on
payments between Member States and between Member States and third
countries shall be prohibited.]
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(46) It is necessary to prohibit any provisions enabling Member
States to require pledging of assets covering the technical
provisions of an insurance or reinsurance undertaking, whatever form
this requirement might take, when the insurer is reinsured by an
insurance or reinsurance undertaking authorised pursuant to this
Directive, or by a third-country undertaking where the supervisory
regime of that third country has been deemed equivalent.
(47)
The legal framework has so far provided
neither detailed criteria for a prudential assessment of a proposed
acquisition nor a procedure for their application.
A clarification of the criteria and the
process of prudential assessment is therefore needed to provide the
necessary legal certainty, clarity and predictability with regard to
the assessment process, as well as to the result thereof.
These criteria and procedures have been
introduced by Directive 2007/44/EC. As regards insurance and
reinsurance these provisions should therefore be codified and
integrated into this Directive.
-----------------------------------------------------------------------------------------------------------------------
[Note: They mean DIRECTIVE 2007/44/EC OF THE
EUROPEAN PARLIAMENT AND OF THE COUNCIL of 5 September 2007 amending
Council Directive 92/49/EEC and Directives 2002/83/EC, 2004/39/EC,
2005/68/EC and 2006/48/EC as regards procedural rules and evaluation
criteria for the prudential assessment of acquisitions and increase
of holdings in the financial sector (Text with EEA relevance)
(48) Maximum harmonisation throughout
the Community of these procedures and prudential assessments is
therefore critical.
However, the
provisions on qualifying holdings should not prevent the Member
States from requiring that the supervisory authorities are to be
informed of acquisitions of holdings below the thresholds laid down
in those provisions, so long as a Member State imposes no more than
one additional threshold below 10 % for this purpose.
Nor should it prevent the supervisory authorities from providing
general guidance as to when such holdings would be deemed to result
in significant influence.
(49) In view of the increasing
mobility of European citizens, motor liability insurance is
increasingly being offered on a cross-border basis.
To ensure the continued proper functioning of the green card system
and the agreements between the national bureaux of motor insurers,
it is appropriate that Member States are able to require insurance
undertakings providing motor liability insurance in their territory
by way of provision of services to join and participate in the
financing of the national bureau as well as of the guarantee fund
set up in that Member State.
The Member
State of provision of services should require undertakings which
provide motor liability insurance to appoint a representative in its
territory to collect all necessary information in relation to claims
and to represent the undertaking concerned.
(50) Within the
framework of an internal market it is in
the interest of policyholders that they should have access to the
widest possible range of insurance products available in the
Community.
The Member State of the
commitment or the Member State in which the risk is situated should
therefore ensure that there is nothing to prevent the marketing
within its territory of all the insurance products offered for sale
in the Community as long as they do not conflict with the legal
provisions protecting the general good in force in that Member State
and in so far as the general good is not safeguarded by the rules of
the home Member State.
 
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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