EIOPA Issues Opinion to Determine Insurance Class for Statutory Risks
EIOPA published its Mediation Opinion on the determination of the correct insurance class for the insurance policy known as statutory risks in France. The Mediation Panel of EIOPA involved the ACPR as host authority and the Central Bank of Ireland as home authority of the insurance undertakings that offer this policy on the freedom to provide services in France.
In line with the risk-based approach of Solvency II and with the aim to promote consistent supervisory practices, the Mediation Panel concluded that the determination of the insurance class should reflect the nature of risk of the given insurance policy rather than its actual legal form. Accordingly, the Mediation Panel supported the classification of statutory risk insurance policy in classes 1 (accident) and 2 (sickness) of Annex I of Solvency II for new authorizations. In case the insurance policy contains death or any other life coverage, an authorization for life insurance activity is also required.
Furthermore, insurance undertakings should have expertise to ensure appropriate pricing, adequate provisioning, and claims management practices, which are relevant to the risks to be covered and to the target market in the host member state. Both the ACPR and the Central Bank of Ireland agreed with the conclusions of the Mediation Panel. The statutory risk insurance policy covers the maintenance of the civil servants' salary in case of sickness, maternity, work incapacity or disability, along with the payment of death benefits to the beneficiaries of a civil servant.
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Keywords: Europe, France, Insurance, Solvency II, Statutory Risk, Mediation Opinion, Insurance Class, ACPR, Central Bank of Ireland, EIOPA
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