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Ban on ancillary business activities for insurers


Insurers are not permitted to carry out any business other than insurance business. How do insurers deal with this ban on ancillary business activities in practice?

Published: 01 January 2007

The ban on ancillary business activities for insurers is laid down in Article 73 in Solvency II and Article 3:36 Wft. The aim is to prevent policyholders from being financially disadvantaged by the fact that an insurer would also operate a business that is not part of the insurance business. Therefore, ancillary activities carried out by the insurer must not entail risks to the insurer’s soundness.

In practice

The starting point is that the insurer must at all times arrange its activities organisationally, administratively and financially in such a way that the resulting risks remain manageable. Nor should the activities entail any unacceptable risks to policyholders.

It is also important that, as stated in parliamentary history, the concept of ‘insurance business’ is interpreted broadly. This also includes activities carried out by an insurer with a view to investing available funds.

This means that the provision of mortgages is considered part of the insurance business because it concerns investment of funds in a responsible manner. The same applies in the event that the insurer provides payments in kind (for example, in the case of a benefits-in-kind funeral insurance, or in the case of certain non-life insurance, such as assistance services) and provides these in-kind services itself. These activities are also considered part of the insurance business.

In line with this, we have provided a further explanation specifically for health insurers that provide basic health insurance under the Health Insurance Act. The Health Insurance Act allows health insurers to engage in activities in the field of health care procurement and health care services.

Ancillary activities

In the case of ancillary activities, the insurer must sufficiently demonstrate to DNB that the risks associated with the various activities are sufficiently secured.

Examples of ancillary activities that are permitted in principle include:

  • Intermediation by insurers. In practice, this activity is often linked to the insurance business because insurers that are not active in all branches can offer a comprehensive package of insurance to future policyholders through mediation.

  • Introduction of policyholders to an investment fund in the context of insurance, for example in the context of offering a comprehensive package of insurance to (future) policyholders.

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