An insurer must comply with all sorts of requirements laid down in the Financial Supervision Act (Wet op het financieel toezicht / Wft) when applying for an authorisation and in carrying on its business. These requirements are intended to promote the solidity of the insurer and therefore also to protect interested parties from the risk of losses due to inadequate solvency or liquidity. De Nederlandsche Bank (DNB) supervises insurers' compliance with the statutory requirements.
The Wft and the related secondary legislation impose requirements on insurers with respect to the following issues (this is not an exhaustive list):
The requirements have been elaborated in secondary legislation and relate to all sorts of operational, technical and financial aspects of the business. The provisions in the secondary legislation take account of the various risks involved, as well as differences in the nature, size and complexity of insurers. For health insurers implementing the Health Insurance Act (Zorgverzekeringswet) specific rules apply for calculating the solvency requirement. The requirements as elaborated largely arise from the international harmonisation of supervisory requirements, often through the implementation of EU directives in Dutch primary and secondary legislation.
Liability-Driven Investment funds (LDI funds) mainly invest in long-term government bonds and long-term interest rate derivatives. The use of these interest rate derivatives exposes LDI funds to liquidity risks in case of large interest rate fluctuations.
Read more Limited liquidity risks in Euro LDI funds
This week, the European Supervisory Authorities (EBA, EIOPA and ESMA – ESAs) have published their final reports on greenwashing in the financial sector.
Read more European Supervisory Authorities publish reports on greenwashing in the financial sector
On Tuesday 28th May from 3:00-4:45 PM CET DNB will organize an online information session about fit and proper assessments.
Read more Information session about fit and proper assessments DNB
The rapid development of artificial intelligence (AI) poses challenges for the supervisory work of the AFM and DNB. The supervisory authorities have published a report with criteria and areas of attention for shaping the supervision of AI.
Read more AFM and DNB publish report on the impact of AI on the financial sector and supervision
