1992L0049 — EN — 11.02.2003 — 003.001 — 1
This document is meant purely as a documentation tool and the institutions do not assume any liability for its contents
►B COUNCILDIRECTIVE92/49/EEC
of18June1992
onthecoordinationoflaws,regulationsandadministrativeprovisionsrelatingtodirectinsurance
other than life assurance and amending Directives 73/239/EEC and 88/357/EEC (third non-life
insuranceDirective)
(OJ L 228, 11.8.1992, p. 1)
Amended by:
Official Journal
No page date
►M1European Parliament and Council Directive 95/26/EC of 29 June 1995 L 168 7 18.7.1995
►M2Directive 2000/64/EC of the European Parliament and of the Council of
7 November 2000L 290 27 17.11.2000
►M3Directive 2002/87/EC of the European Parliament and of the Council of
16 December 2002L 35 1 11.2.2003
Corrected by:
►C1Corrigendum, OJ L 311, 14.11.1997, p. 34 (92/49/EEC)
NB: This consolidated version contains references to the European unit of account and/or the ecu, which from 1 January 1999
should be understood as references to the euro — Council Regulation (EEC) No 3308/80 (OJ L 345, 20.12.1980, p. 1) andCouncil Regulation (EC) No 1103/97 (OJ L 162, 19.6.1997, p. 1).
▼B
COUNCILDIRECTIVE92/49/EEC
of18June1992
on the coordination of laws, regulations and administrative provi-
sions relating to direct insurance other than life assurance andamending Directives 73/239/EEC and 88/357/EEC (third non-life
insuranceDirective)
THE COUNCIL OF THE EUROPEAN COMMUNITIES,
Having regard to the Treaty establishing the European Economic
Community, and in particular Articles 57 (2) and 66 thereof,
Having regard to the proposal from the Commission (1),
In cooperation with the European Parliament (2),
Having regard to the opinion of the Economic and Social
Committee (3),
(1)Whereas it is necessary to complete the internal market in directinsurance other than life assurance from the point of view bothof the right of establishment and of the freedom to provideservices, to make it easier for insurance undertakings with headoffices in the Community to cover risks situated within the
Community;
(2)Whereas the Second Council Directive of 22 June 1988 on the
coordination of laws, regulations and administrative provisionsrelating to direct insurance other than life assurance and laying
down provisions to facilitate the effective exercise of freedom
to provide services and amending Directive 72/239/EEC (88/357/EEC) (
4)has already contributed substantially to the achieve-
ment of the internal market in direct insurance other than lifeassurance by granting policyholders who, by virtue of theirstatus, their size or the nature of the risks to be insured, do not
require special protection in the Member State in which a risk is
situated complete freedom to avail themselves of the widestpossible insurance market;
(3)Whereas Directive 88/357/EEC therefore represents an important
stage in the merging of national markets into an integrated
market and that stage must be supplemented by other Commu-nity instruments with a view to enabling all policyholders,irrespective of their status, their size or the nature of the risksto be insured, to have recourse to any insurer with a head officein the Community who carries on business there, under the right
of establishment or the freedom to provide services, while guar-
anteeing them adequate protection;
(4)Whereas this Directive forms part of the body of Communitylegislation already enacted which includes the First Council
Directive of 24 July 1973 on the coordination of laws, regula-
tions and administrative provisions relating to the taking up andpursuit of the business of direct insurance other than life assur-ance (73/239/EEC) (
5) and the Council Directive of 19 December
1991 on the annual accounts and consolidated accounts of insur-ance undertakings (91/674/EEC) (
6);
(5)Whereas the approach adopted consists in bringing about suchharmonization as is essential, necessary and sufficient to achieve1992L0049 — EN — 11.02.2003 — 003.001 — 2
(1) OJ No C 244, 28. 9. 1990, p. 28 and
OJ No C 93, 13. 4. 1992, p. 1.
(2) OJ No C 67, 16. 3. 1992, p. 98 and
OJ No C 150, 15. 6. 1992.
(3) OJ No C 102, 18. 4. 1991, p. 7.
(4) OJ No L 172, 4. 7. 1988, p. 1. Last amended by Directive 90/618/EEC (OJ
No L 330, 29. 11. 1990, p. 44).
(5) OJ No L 228, 16. 8. 1973, p. 3. Last amended by Directive 88/357/EEC (OJ
No L 172, 4. 7. 1988, p. 1).
(6) OJ No L 374, 31. 12. 1991, p. 7.
▼B
the mutual recognition of authorizations and prudential control
systems, thereby making it possible to grant a single authoriza-tion valid throughout the Community and apply the principle of
supervision by the home Member State;
(6)Whereas, as a result, the taking upand the p ursuit of the busi-
ness of insurance are henceforth to be subject to the grant of asingle official authorization issued by the competent authoritiesof the Member State in which an insurance undertaking has its
head office; whereas such authorization enables an undertaking
to carry on business throughout the Community, under the rightof establishment or the freedom to provide services; whereas theMember State of the branch or of the provision of services mayno longer require insurance undertakings which wish to carry on
insurance business there and which have already been authorized
in their home Member State to seek fresh authorization; whereasDirectives 73/239/EEC and 88/357/EEC should therefore beamended along those lines;
(7)Whereas the competent authorities of home Member States willhenceforth be responsible for monitoring the financial health of
insurance undertakings, including their state of solvency, the
establishment of adequate technical provisions and the coveringof those provisions by matching assets;
(8)Whereas certain provisions of this Directive define minimumstandards; whereas a home Member State may lay down stricter
rules for insurance undertakings authorized by its own competent
authorities;
(9)Whereas the competent authorities of the Member States musthave at their disposal such means of supervision as are necessaryto ensure the orderly pursuit of business by insurance undertak-
ings throughout the Community whether carried on under the
right of establishment or the freedom to provide services;whereas, in particular, they must be able to introduce appropriatesafeguards or impose sanctions aimed at preventing irregularitiesand infringements of the provisions on insurance supervision;
(10)Whereas the internal market comprises an area without internalfrontiers and involves access to all insurance business otherthan life assurance throughout the Community and, hence, thepossibility for any duly authorized insurer to cover any of therisks referred to in the Annex to Directive 73/239/EEC; whereas,to that end, the monopoly enjoyed by certain bodies in certain
Member States in respect of the coverage of certain risks must
be abolished;
(11)Whereas the provisions on transfers of portfolios must beadapted to bring them into line with the single authorizationsystem introduced by this Directive;
(12)Whereas Directive 91/674/EEC has already effected the neces-sary harmonization of the Member States' rules on the technicalprovisions which insurers are required to establish to cover theircommitments, and that harmonization makes it possible to grantmutual recognition of those provisions;
(13)Whereas the rules governing the spread, localization andmatching of the assets used to cover technical provisions mustbe coordinated in order to facilitate the mutual recognition ofMember States' rules; whereas that coordination must takeaccount of the measures on the liberalization of capital move-ments provided for in the Council Directive of 24 June 1988
for the implementation of Article 67 of the Treaty (88/361/
EEC) (
1) and the progress made by the Community towards
economic and monetary union;
(14)Whereas, however, the home Member State may not requireinsurance undertakings to invest the assets covering their tech-1992L0049 — EN — 11.02.2003 — 003.001 — 3
(1) OJ No L 178, 8.7.1988, p. 5.
▼B
nical provisions in particular categories of assets, as such a
requirement would be incompatible with the measures on theliberalization of capital movements provided for in Directive
88/361/EEC;
(15)Whereas, pending the adoption of a Directive on investment
services harmonizing inter alia the definition of the concept of
regulated market, for the purposes of this Directive and without
prejudice to such future harmonization that concept must be
defined provisionally; whereas that definition will be replacedby that harmonized at Community level which will give thehome Member State of the market the responsibilities for thesematters which this Directive transitionally gives to the insuranceundertaking's home Member State;
(16)Whereas the list of items of which the solvency margin requiredby Directive 73/239/EEC may be made up must be supple-mented to take account of new financial instruments and of thefacilities granted to other financial institutions for the constitu-
tion of their own funds;
(17)Whereas within the framework of an integrated insurance market
policyholders who, by virtue of their status, their size or thenature of the risks to be insured, do not require special protec-tion in the Member State in which a risk is situated should be
granted complete freedom to choose the law applicable to their
insurance contracts;
(18)Whereas the harmonization of insurance contract law is not aprior condition for the achievement of the internal market ininsurance; whereas, therefore, the opportunity afforded to the
Member States of imposing the application of their law to insur-
ance contracts covering risks situated within their territories islikely to provide adequate safeguards for policyholders whorequire special protection;
(19)Whereas within the framework of an internal market it is in thepolicyholder's interest that he should have access to the widestpossible range of insurance products available in the Communityso that he can choose that which is best suited to his needs;whereas it is for the Member State in which the risk is situatedto 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 provi-sions protecting the general good in force in the Member State inwhich the risk is situated, and insofar as the general good is notsafeguarded by the rules of the home Member State, provided
that such provisions must be applied without discrimination to
all undertakings operating in that Member State and be objec-tively necessary and in proportion to the objective pursued;
(20)Whereas the Member States must be able to ensure that theinsurance products and contract documents used, under the right
of establishment or the freedom to provide services, to cover
risks situated within their territories comply with such specificlegal provisions protecting the general good as are applicable;whereas the systems of supervision to be employed must meetthe requirements of an integrated market but their employmentmay not constitute a prior condition for carrying on insurance
business; whereas from this standpoint systems for the prior
approval of policy conditions do not appear to be justified;whereas it is therefore necessary to provide for other systemsbetter suited to the requirements of an internal market whichenable every Member State to guarantee policyholders adequate
protection;
(21)Whereas if a policyholder is a natural person, he should be
informed by the insurance undertaking of the law which willapply to the contract and of the arrangements for handlingpolicyholders' complaints concerning contracts;1992L0049 — EN — 11.02.2003 — 003.001 — 4
▼B
(22)Whereas in some Member States private or voluntary health
insurance serves as a partial or complete alternative to health
cover provided for by the social security systems;
(23)Whereas the nature and social consequences of health insurancecontracts justify the competent authorities of the Member Statein which a risk is situated in requiring systematic notification ofthe general and special policy conditions in order to verify that
such contracts are a partial or complete alternative to the health
cover provided by the social security system; whereas such veri-fication must not be a prior condition for the marketing of theproducts; whereas the particular nature of health insurance,serving as a partial or complete alternative to the health coverprovided by the social security system, distinguishes it from
other classes of indemnity insurance and life assurance insofar
as it is necessary to ensure that policyholders have effectiveaccess to private health cover or health cover taken out on avoluntary basis regardless of their age or risk profile;
(24)Whereas to this end some Member States have adopted specificlegal provisions; whereas, to protect the general good, it is
possible to adopt or maintain such legal provisions in so far as
they do not unduly restrict the right of establishment or thefreedom to provide services, it being understood that such provi-sions must apply in an identical manner whatever the homeMember State of the undertaking may be; whereas these legalprovisions may differ in nature according to the conditions in
each Member State; whereas these measures may provide for
open enrolment, rating on a uniform basis according to the typeof policy and lifetime cover; whereas that objective may also beachieved by requiring undertakings offering private health coveror health cover taken out on a voluntary basis to offer standard
policies in line with the cover provided by statutory social
security schemes at a premium rate at or below a prescribedmaximum and to participate in loss compensation schemes;whereas, as a further possibility, it may be required that the tech-nical basis of private health cover or health cover taken out on avoluntary basis be similar to that of life assurance;
(25)Whereas, because of the coordination effected by Directive 73/239/EEC as amended by this Directive, the possibility, affordedto the Federal Republic of Germany under Article 7 (2) (c) ofthe same Directive, of prohibiting the simultaneous transactionof health insurance and other classes is no longer justified andmust therefore be abolished;
(26)Whereas Member States may require any insurance undertakingsoffering compulsory insurance against accidents at work at theirown risk within their territories to comply with the specificprovisions laid down in their national law on such insurance;whereas, however, this requirement may not apply to the provi-sions concerning financial supervision, which are the exclusive
responsibility of the home Member State;
(27)Whereas exercise of the right of establishment requires an under-
taking to maintain a permanent presence in the Member State ofthe branch; whereas responsibility for the specific interests ofinsured persons and victims in the case of third-party liabilitymotor insurance requires adequate structures in the Member
State of the branch for the collection of all the necessary infor-
mation on compensation claims relating to that risk, withsufficient powers to represent the undertaking vis-à-vis injuredparties who could claim compensation, including powers to paysuch compensation, and to represent the undertaking or, if neces-sary, to arrange for it to be represented in the courts and before
the competent authorities of that Member State in connection
with claims for compensation;
(28)Whereas within the framework of the internal market noMember State may continue to prohibit the simultaneouscarrying on of insurance business within its territory under theright of establishment and the freedom to provide services;1992L0049 — EN — 11.02.2003 — 003.001 — 5
▼B
whereas the option granted to Member States in this connection
by Directive 88/357/EEC should therefore be abolished;
(29)Whereas provision should be made for a system of penalties to
be imposed when, in the Member State in which a risk is situ-
ated, an insurance undertaking does not comply with thoseprovisions protecting the general good that are applicable to it;
(30)Whereas some Member States do not subject insurance transac-tions to any form of indirect taxation, while the majority applyspecial taxes and other forms of contribution, includingsurcharges intended for compensation bodies; whereas the struc-
tures and rates of such taxes and contributions vary considerably
between the Member States in which they are applied; whereas itis desirable to prevent existing differences' leading to distortionsof competition in insurance services between Member States;whereas, pending subsequent harmonization, application of the
tax systems and other forms of contribution provided for by the
Member States in which risks are situated is likely to remedythat problem and it is for the Member States to make arrange-ments to ensure that such taxes and contributions are collected;
(31)Whereas technical adjustments to the detailed rules laid down inthis Directive may be necessary from time to time to takeaccount of the future development of the insurance industry;
whereas the Commission will make such adjustments as and
when necessary, after consulting the Insurance Committee setupby Directive 91/675/EEC (
1), in the exercise of the imple-
menting powers conferred on it by the Treaty;
(32)Whereas it is necessary to adopt specific provisions intended toensure smooth transition from the legal regime in existence
when this Directive becomes applicable to the regime that it
introduces, taking care not to place an additional workload onMember States' competent authorities;
(33)Whereas under Article 8 c of the Treaty account should be takenof the extent of the effort which must be made by certain econo-mies at different stages of development; whereas, therefore,
transitional arrangements should be adopted for the gradual
application of this Directive by certain Member States,
HAS ADOPTED THIS DIRECTIVE:
TITLE I
DEFINITIONSANDSCOPE
Article 1
For the purposes of this Directive:
(a)insurance undertaking shall mean an undertaking which has
received official authorization in accordance with Article 6 of
Directive 73/239/EEC;
(b)branchshall mean an agency or branch of an insurance under-
taking, having regard to Article 3 of Directive 88/357/EEC;
(c)home Member State shall mean the Member State in which the
head office of the insurance undertaking covering a risk is situated;
(d)Member State of the branch shall mean the Member State in which
the branch covering a risk is situated;
(e)Member State of the provision of services shall mean the Member
State in which a risk is situated, as defined in Article 2 (d) ofDirective 88/357/EEC, if it is covered by an insurance undertakingor a branch situated in another Member State;1992L0049 — EN — 11.02.2003 — 003.001 — 6
(1) OJ No L 374, 31. 12. 1991, p. 32.
▼B
(f)controlshall mean the relationshipbetween a p arent undertaking
and a subsidiary, as defined in Article 1 of Directive 83/349/EEC (
1), or a similar relationshipbetween any natural or legal
person and an undertaking;
(g)qualifying holding shall mean a direct or indirect holding in an
undertaking which represents 10 % or more of the capital or ofthe voting rights or which makes it possible to exercise a signifi-
cant influence over the management of the undertaking in which a
holding subsists.
For the purposes of this definition, in the context of Articles 8 and
15 and of the other levels of holding referred to in Article 15, thevoting rights referred to in Article 7 of Directive 88/627/EEC (
2)
shall be taken into account;
(h)parent undertaking shall mean a parent undertaking as defined in
Articles 1 and 2 of Directive 83/349/EEC;
(i)subsidiary shall mean a subsidiary undertaking as defined in Arti-
cles 1 and 2 of Directive 83/349/EEC; any subsidiary of asubsidiary undertaking shall also be regarded as a subsidiary ofthe undertaking which is those undertakings' ultimate parent under-taking;
(j)regulated market shall mean a financial market regarded by an
undertaking's home Member State as a regulated market pendingthe adoption of a definition in a Directive on investment servicesand characterized by:
— regular operation, and
— the fact that regulations issued or approved by the appropriate
authorities define the conditions for the operation of the market,
the conditions for access to the market and, where the Council
Directive of 5 March 1979 coordinating the conditions for theadmission of securities to official stock-exchange listing (79/279/EEC) (
3) applies, the conditions for admission to listing
imposed in that Directive or, where that Directive does not
apply, the conditions to be satisfied by a financial instrument
in order to be effectively dealt in on the market.
For the purposes of this Directive, a regulated market may be situ-
ated in a Member State or in a third country. In the latter event, themarket must be recognized by the home Member State and meet
comparable requirements. Any financial instruments dealt in on
that market must be of a quality comparable to that of the instru-ments dealt in on the regulated market or markets of the MemberState in question;
(k)competent authorities shall mean the national authorities which are
empowered by law or regulation to supervise insurance undertak-ings;
(l) ‘close links ’ shall mean a situation in which two or more natural or
legal persons are linked by:
(a) ‘participation’, which shall mean the ownership, direct or by
way of control, of 20 % or more of the voting rights or capitalof an undertaking or
(b) ‘control’, which shall mean the relationshipbetween a p arent
undertaking and a subsidiary, in all the cases referred to in
Article 1 (1) and (2) of Directive 83/349/EEC (
4), or a similar
relationshipbetween any natural or legal p erson and an under-taking; any subsidiary undertaking of a subsidiary undertaking1992L0049 — EN — 11.02.2003 — 003.001 — 7
(1) OJ No L 193, 18. 7. 1983, p. 1.
(2) OJ No L 348, 17. 12. 1988, p. 62.
(3) OJ No L 66, 13. 3. 1979, p. 21. Last amended by Directive 82/148/EEC (OJ
No L 62, 5. 3. 1982, p. 22).
(4) OJ No L 193, 18. 7. 1983, p. 1. Directive as last amended by Directive 90/
605/EEC (OJ No L 317, 16. 11. 1990, p. 60).▼M1
▼M1
shall also be considered a subsidiary of the parent undertaking
which is at the head of those undertakings.
A situation in which two or more natural or legal persons are
permanently linked to one and the same person by a control rela-
tionshipshall also be regarded as constituting a close link betweensuch persons.
Article 2
1. This Directive shall apply to the types of insurance and undertak-
ings referred to in Article 1 of Directive 73/239/EEC.
2. This Directive shall apply neither to the types of insurance or
operations, nor to undertakings or institutions to which Directive 73/239/EEC does not apply, nor to the bodies referred to in Article 4 of
that Directive.
Article 3
Notwithstanding Article 2 (2), Member States shall take every stepto
ensure that monopolies in respect of the taking up of the business ofcertain classes of insurance, granted to bodies established within theirterritories and referred to in Article 4 of Directive 73/239/EEC, areabolished by 1 July 1994.
TITLE II
THETAKINGUPOFTHEBUSINESSOFINSURANCE
Article 4
Article 6 of Directive 73/239/EEC shall be replaced by the following:
‘Article 6
The taking upof the business of direct insurance shall be subject to
prior official authorization.
Such authorization shall be sought from the competent authorities
of the home Member State by:
(a) any undertaking which establishes its head office within the
territory of that State;
(b) any undertaking which, having received the authorization
referred to in the first subparagraph, extends its business to anentire class or to other classes’.
Article 5
Article 7 of Directive 73/239/EEC shall be replaced by the following:
‘Article 7
1. Authorization shall be valid for the entire Community. It shall
permit an undertaking to carry on business there, under either theright of establishment or the freedom to provide services.
2. Authorization shall be granted for a particular class of insur-
ance. It shall cover the entire class, unless the applicant wishes to
cover only some of the risks pertaining to that class, as listed inpoint A of the Annex.
However:
(a) Member States may grant authorization for the groups of
classes listed in point B of the Annex, attaching to them theappropriate denominations specified therein;
(b) authorization granted for one class or a groupof classes shall
also be valid for the purpose of covering ancillary risksincluded in another class if the conditions imposed in point Cof the Annex are fulfilled’.1992L0049 — EN — 11.02.2003 — 003.001 — 8
▼B
▼B
Article 6
Article 8 of Directive 72/239/EEC shall be replaced by the following:
‘Article 8
1. The home Member State shall require every insurance under-
taking for which authorization is sought to:
(a) adopt one of the following forms:
— in the case of the Kingdom of Belgium: “société
anonyme — naamloze vennootschap”, “société en comman-dite par actions — commanditaire vennootschap opaandelen”, “association d'assurance mutuelle — onderlinge
verzekeringsvereniging”, “société coopérative — coöpera-
tieve vennootschap”;
— in the case of the Kingdom of Denmark: “aktieselskaber”,
“gensidige selskaber”;
— in the case of the Federal Republic of Germany: “Aktienge-
sellschaft”, “Versicherungsverein auf Gegenseitigkeit”,“Öffentlich-rechtliches Wettbewerbsversicherungsunter-nehmen”;
— in the case of the French Republic: “société anonyme”,
“société d'assurance mutuelle”, “institution de prévoyance
régie par le code de la sécurité sociale”, “institution deprévoyance régie par le code rural” and “mutuelles régiespar le code de la mutualité”;
— in the case of Ireland: incorporated companies limited by
shares or by guarantee or unlimited;
— in the case of the Italian Republic: “società per azioni”,
“società cooperativa”, “mutua di assicurazione”;
— in the case of the Grand Duchy of Luxembourg: “société
anonyme”, “société en commandite par actions”, “associa-tion d'assurances mutuelles”, “société coopérative”;
— in the case of the Kingdom of the Netherlands: “naamloze
vennootschap”, “onderlinge waarborgmaatschappij”;
— in the case of the United Kingdom: incorporated companies
limited by shares or by guarantee or unlimited, societiesregistered under the Industrial and Provident SocietiesActs, societies registered under the Friendly Societies Acts,the association of underwriters known as Lloyd's;
— in the case of the Hellenic Republic: “ ανώνυµη εταιρία ”,
“αλληλασφαλιστικός συνεταιρισµός ”;
— in the case of the Kingdom of Spain: “sociedad anónima”,
“sociedad mutua”, “sociedad cooperativa”;
— in the case of the Portuguese Republic: “sociedade
anónima”, “mútua de seguros”.
An insurance undertaking may also adopt the form of a
European Company (SE) when that has been established.
Furthermore, Member States may, where appropriate, set up
undertakings in any public-law form provided that such bodieshave as their objects insurance operations under conditions
equivalent to those under which private-law undertakings
operate;
(b) limit its objects to the business of insurance and operations
arising directly therefrom, to the exclusion of all other commer-cial business;
(c) submit a scheme of operations in accordance with Article 9;
(d) possess the minimum guarantee fund provided for in Article 17
(2);
(e) be effectively run by persons of good repute with appropriate
professional qualifications or experience.
2. An undertaking seeking authorization to extend its business to
other classes or to extend an authorization covering only some of1992L0049 — EN — 11.02.2003 — 003.001 — 9
▼B
the risks pertaining to one class shall be required to submit a
scheme of operations in accordance with Article 9.
It shall, furthermore, be required to show proof that it possesses the
solvency margin provided for in Article 16 and, if with regard tosuch other classes Article 17 (2) requires a higher minimum guar-antee fund than before, that is possesses that minimum.
3. Nothing in this Directive shall prevent Member States from
maintaining in force or introducing laws, regulations or administra-tive provisions requiring approval of the memorandum and articlesof association and communication of any other documents neces-
sary for the normal exercise of supervision.
Member States shall not, however, adopt provisions requiring the
prior approval or systematic notification of general and specialpolicy conditions, scales of premiums and forms and other printed
documents which an undertaking intends to use in its dealings with
policyholders.
Member States may not retain or introduce prior notification or
approval of proposed increases in premium rates except as part of
general price-control systems.
Nothing in this Directive shall prevent Member States from
subjecting undertakings seeking or having obtained authorizationfor class 18 in point A of the Annex to checks on their direct or
indirect resources in staff and equipment, including the qualifica-
tion of their medical teams and the quality of the equipmentavailable to such undertakings to meet their commitments arisingout of this class of insurance.
4. The abovementioned provisions may not require that any
application for authorization be considered in the light of theeconomic requirements of the market’.
Article 7
Article 9 of Directive 73/239/EEC shall be replaced by the following:
‘Article 9
The scheme of operations referred to in Article 8 (1) (c) shall
include particulars or proof concerning:
(a) the nature of the risks which the undertaking proposes to cover;
(b) the guiding principles as to reinsurance;
(c) the items constituting the minimum guarantee fund;
(d) estimates of the costs of setting upthe administrative services
and the organization for securing business; the financial
resources intended to meet those costs and, if the risks to be
covered are classified in class 18 in point A of the Annex, theresources at the undertaking's disposal for the provision of theassistance promised
and, in addition, for the first three financial years:
(e) estimates of management expenses other than installation costs,
in particular current general expenses and commissions;
(f) estimates of premiums or contributions and claims;
(g) a forecast balance sheet;
(h) estimates of the financial resources intended to cover under-
writing liabilities and the solvency margin.’
Article 8
The competent authorities of the home Member State shall not grant an
undertaking authorization to take upthe business of insurance beforethey have been informed of the identities of the shareholders ormembers, direct or indirect, whether natural or legal persons, whohave qualifying holdings in that undertaking and of the amounts ofthose holdings.1992L0049 — EN — 11.02.2003 — 003.001 — 10
▼B
The same authorities shall refuse authorization if, taking into account
the need to ensure the sound and prudent management of an insuranceundertaking, they are not satisfied as to the qualifications of the share-
holders or members.
TITLE III
HARMONIZATION OF THE CONDITIONS GOVERNING THE BUSI-
NESSOFINSURANCE
Chapter1
Article 9
Article 13 of Directive 73/239/EEC shall be replaced by the following:
‘Article 13
1. The financial supervision of an insurance undertaking,
including that of the business it carries on either through branches
or under the freedom to provide services, shall be the sole respon-
sibility of the home Member State.
2. That financial supervision shall include verification, with
respect to the insurance undertaking's entire business, of its stateof solvency, of the establishment of technical provisions and of
the assets covering them in accordance with the rules laid down or
practices followed in the home Member State under provisionsadopted at Community level.
Where the undertaking in question is authorized to cover the risks
classified in class 18 in point A of the Annex, supervision shall
extend to monitoring of the technical resources which the under-
taking has at its disposal for the purpose of carrying out theassistance operations it has undertaken to perform, where the lawof the home Member State provides for the monitoring of suchresources.
3. The competent authorities of the home Member State shall
require every insurance undertaking to have sound administrativeand accounting procedures and adequate internal control mechan-isms.’
Article 10
Article 14 of Directive 73/239/EEC shall be replaced by the following:
‘Article 14
The Member State of the branch shall provide that where an insur-
ance undertaking authorized in another Member State carries onbusiness through a branch the competent authorities of the home
Member State may, after having informed the competent authorities
of the Member State of the branch, carry out themselves or throughthe intermediary of persons they appoint for that purpose on-the-spot verification of the information necessary to ensure the finan-cial supervision of the undertaking. The authorities of the Member
State of the branch may participate in that verification’.
Article 11
Article 19 (2) and (3) of Directive 73/239/EEC shall be replaced by the
following:
‘2. Member States shall require insurance undertakings with
head offices within their territories to render periodically thereturns, together with statistical documents, which are necessaryfor the purposes of supervision. The competent authorities shallprovide each other with any documents and information that are
useful for the purposes of supervision.
3. Every Member State shall take all steps necessary to ensure
that the competent authorities have the powers and means neces-sary for the supervision of the business of insurance undertakingswith head offices within their territories, including business carried1992L0049 — EN — 11.02.2003 — 003.001 — 11
▼B
on outwith those territories, in accordance with the Council Direc-
tives governing such business and for the purpose of seeing thatthey are implemented.
These powers and means must, in particular, enable the competent
authorities to:
(a) make detailed enquiries regarding an undertaking's situation
and the whole of its business, inter alia, by:
— gathering information or requiring the submission of docu-
ments concerning its insurance business,
— carrying out on-the-spot investigations at the undertaking's
premises;
(b) take any measures with regard to an undertaking, its directors
or managers or the persons who control it, that are appropriate
and necessary to ensure that that undertaking's business
continues to comply with the laws, regulations and administra-tive provisions with which the undertaking must comply ineach Member State and in particular with the scheme of opera-tions insofar as it remains mandatory, and to prevent or remedy
any irregularities prejudicial to the interests of insured persons;
(c) ensure that those measures are carried out, if need be by enfor-
cement and where appropriate through judicial channels.
Member States may also make provision for the competent authori-
ties to obtain any information regarding contracts which are held byintermediaries.’
Article 12
1. Article 11 (2) to (7) of Directive 88/357/EEC is hereby repealed.2. Under the conditions laid down by national law, each Member
State shall authorize insurance undertakings with head offices withinits territory to transfer all or part of their portfolios of contracts,concluded either under the right of establishment or the freedom to
provide services, to an accepting office established within the Commu-
nity, if the competent authorities of the home Member State of theaccepting office certify that after taking the transfer into account thelatter possesses the necessary solvency margin.
3. Where a branch proposes to transfer all or part of its portfolio of
contracts, concluded either under the right of establishment or thefreedom to provide services, the Member State of the branch shall be
consulted.
4. In the circumstances referred to in paragraphs 2 and 3, the
competent authorities of the home Member State of the transferringundertaking shall authorize the transfer after obtaining the agreementof the competent authorities of the Member States in which the risksare situated.
5. The competent authorities of the Member States consulted shall
give their opinion or consent to the competent authorities of the home
Member State of the transferring insurance undertaking within threemonths of receiving a request; the absence of any response within thatperiod from the authorities consulted shall be considered equivalent toa favourable opinion or tacit consent.
6. A transfer authorized in accordance with this Article shall be
published as laid down by national law in the Member State in which
the risk is situated. Such transfers shall automatically be valid againstpolicy-holders, insured persons and any other persons having rights orobligations arising out of the contracts transferred.
This provision shall not affect the Member States' rights to give policy-
holders the option of cancelling contracts within a fixed period after atransfer.1992L0049 — EN — 11.02.2003 — 003.001 — 12
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Article 13
1. Article 20 of Directive 73/239/EEC shall be replaced by the
following:
‘Article 20
1. If an undertaking does not comply with Article 15, the
competent authority of its home Member State may prohibit thefree disposal of its assets after having communicated its intentionto the competent authorities of the Member States in which therisks are situated.
2. For the purposes of restoring the financial situation of an
undertaking the solvency margin of which has fallen below theminimum required under Article 16 (3), the competent authority ofthe home Member State shall require that a plan for the restorationof a sound financial situation be submitted for its approval.
In exceptional circumstances, if the competent authority is of the
opinion that the financial situation of the undertaking will deterio-rate further, it may also restrict or prohibit the free disposal of theundertaking's assets. It shall inform the authorities of other MemberStates within the territories of which the undertaking carries on
business of any measures it has taken and the latter shall, at the
request of the former, take the same measures.
3. If the solvency margin falls below the guarantee fund as
defined in Article 17, the competent authority of the home Member
State shall require the undertaking to submit a short-term finance
scheme for its approval.
It may also restrict or prohibit the free disposal of the undertaking's
assets. It shall inform the authorities of other Member States withinthe territories of which the undertaking carries on business accord-
ingly and the latter shall, at the request of the former, take the same
measures.
4. The competent authorities may further take all measures
necessary to safeguard the interests of insured persons in the cases
provided for in paragraphs 1, 2 and 3.
5. Each Member State shall take the measures necessary to be
able, in accordance with its national law, to prohibit the freedisposal of assets located within its territory at the request, in thecases provided for in paragraphs 1, 2 and 3, of the undertaking's
home Member State, which shall designate the assets to be covered
by such measures.’
Article 14
Article 22 of Directive 73/239/EEC shall be replaced by the following:
‘Article 22
1. Authorization granted to an insurance undertaking by the
competent authority of its home Member State may be withdrawnby that authority if that undertaking:
(a) does not make use of that authorization within 12 months,
expressly renounces it or ceases to carry on business for more
than six months, unless the Member State concerned has made
provision for authorization to lapse in such cases;
(b) no longer fulfils the conditions for admission;
(c) has been unable, within the time allowed, to take the measures
specified in the restoration plan or finance scheme referred to
in Article 20;
(d) fails seriously in its obligation under the regulations to which it
is subject.
In the event of the withdrawal or lapse of authorization, the compe-
tent authority of the home Member State shall notify the competentauthorities of the other Member States accordingly, and they shalltake appropriate measures to prevent the undertaking fromcommencing new operations within their territories, under either1992L0049 — EN — 11.02.2003 — 003.001 — 13
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the right of establishment or the freedom to provide services. The
home Member State's competent authority shall, in conjunctionwith those authorities, take all measures necessary to safeguard the
interests of insured persons and, in particular, shall restrict the free
disposal of the undertaking's assets in accordance with Article 20(1), (2), second subparagraph, or (3), second subparagraph.
2. Any decision to withdraw authorization shall be supported by
precise reasons and communicated to the undertaking in question.’
Article 15
1. Member States shall require any natural or legal person
►
C1who proposes to hold ◄, directly or indirectly, a qualifying
holding in an insurance undertaking first to inform the competentauthorities of the home Member State, indicating the size of hisintended holding. Such a person must likewise inform the competent
authorities of the home Member State if he proposes to increase his
qualifying holding so that the proportion of the voting rights or of thecapital he holds would reach or exceed 20, 33 or 50 % or so that theinsurance undertaking would become his subsidiary.
The competent authorities of the home Member State shall have up to
three months from the date of the notification provided for in the firstsubparagraph to oppose such a plan if, in view of the need to ensuresound and prudent management of the insurance undertaking in ques-tion, they are not satisfied as to the qualification of the personreferred to in the first subparagraph. If they do not oppose the plan in
question, they may fix a maximum period fort its implementation.
1a. If the acquirer of the holdings referred to in paragraph 1 is an
insurance undertaking, a credit institution or an investment firmauthorised in another Member State, or the parent undertaking of suchan entity, or a natural or legal person controlling such an entity, and if,as a result of that acquisition, the undertaking in which the acquirer
proposes to hold a holding would become a subsidiary or subject to
the control of the acquirer, the assessment of the acquisition must besubject to the prior consultation referred to in Article 12a of Directive73/239/EEC.
2. Member States shall require any natural or legal person who
proposes to dispose, directly or indirectly, of a qualifying holding inan insurance undertaking first to inform the competent authorities of
the home Member State, indicating the size of his intended holding.
Such a person must likewise inform the competent authorities if heproposes to reduce his qualifying holding so that the proportion of thevoting rights or of the capital he holds would fall below 20, 33 or 50 %or so that the insurance undertaking would cease to be his subsidiary.
3. On becoming aware of them, insurance undertakings shall inform
the competent authorities of their home Member States of any acquisi-tions or disposals of holdings in their capital that cause holdings toexceed or fall below any of the tresholds referred to in paragraphs 1and 2.
They shall also, at least once a year, inform them of the names of
shareholders and members possessing qualifying holdings and the sizesof such holdings as shown, for example, by the information received atannual general meetings of shareholders or members or as a result of
compliance with the regulations relating to companies listed on stock
exchanges.
4. Member States shall require that, where the influence exercised
by the persons referred to in paragraph 1 is likely to operate against
the prudent and sound management of an insurance undertaking, the
competent authorities of the home Member State shall take appropriatemeasures to put an end to that situation. Such measures may consist,for example, in injunctions, sanctions against directors and managers,or suspension of the exercise of the voting rights attaching to the sharesheld by the shareholders or members in question.1992L0049 — EN — 11.02.2003 — 003.001 — 14
▼M3
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▼B
Similar measures shall apply to natural or legal persons failing to
comply with the obligation to provide prior information imposes inparagraph 1. If a holding is acquired despite the opposition of the
competent authorities, the Member States shall, regardless of any other
sanctions to be adopted, provide either for exercise of the corre-sponding voting rights to be suspended, or for the nullity of votes castor for the possibility of their annulment.
Article 16
1. The Member States shall provide that all persons working or who
have worked for the competent authorities, as well as auditors and
experts acting on behalf of the competent authorities, shall be boundby the obligation of professional secrecy. This means that no confiden-tial information which they may receive while performing their dutiesmay be divulged to any person or authority whatsoever, except in
summary or aggregate form, such that individual insurance undertak-
ings cannot be identified, without prejudice to cases covered bycriminal law.
Nevertheless, where an insurance undertaking has been declared bank-
rupt or is being compulsorily wound up, confidential information whichdoes not concern third parties involved in attempts to rescue thatundertaking may be divulged in civil or commercial proceedings.
2. Paragraph 1 shall not prevent the competent authorities of
different Member States from exchanging information in accordancewith the Directives applicable to insurance undertakings. Such informa-tion shall be subject to the conditions of professional secrecy laid down
in paragraph 1.
3. Member States may conclude cooperation agreements providing
for exchange of information with the competent authorities of thirdcountries or with authorities or bodies of third countries as defined in
paragraphs 5 and 5a only if the information disclosed is subject to
guarantees of professional secrecy at least equivalent to those referredto in this Article. Such exchange of information must be intended forthe performance of the supervisory task of the authorities or bodiesmentioned.
Where the information originates in another Member State, it may not
be disclosed without the express agreement of the competent authori-ties which have disclosed it and, where appropriate, solely for the
purposes for which those authorities gave their agreement.
4. Competent authorities receiving confidential information under
paragraphs 1 or 2 may use it only in the course of their duties:
— to check that the conditions governing the taking upof the business
of insurance are met and to facilitate monitoring of the conduct of
such business, especially with regard to the monitoring of technicalprovisions, solvency margins, administrative and accounting proce-dures and internal control mechanisms,
— to impose sanctions,
— in administrative appeals against decisions of the competent autho-
rities, or
— in court proceedings initiated under Article 56 or under special
provisions provided for in the Directives adopted in the field ofinsurance undertakings.
5. Paragraphs 1 and 4 shall not preclude the exchange of informa-
tion within a Member State, where there are two or more competentauthorities in the same Member State, or, between Member States,between competent authorities and:
— authorities responsible for the official supervision of credit institu-
tions and other financial organizations and the authorities
responsible for the supervision of financial markets,
— bodies involved in the liquidation and bankruptcy of insurance
undertakings and in other similar procedures, and1992L0049 — EN — 11.02.2003 — 003.001 — 15
▼M2
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— persons responsible for carrying out statutory audits of the accounts
of insurance undertakings and other financial institutions,
in the discharge of their supervisory functions, or the disclosure to
bodies which administer compulsory winding-up proceedings or guar-
antee funds of information necessary to the performance of theirduties. The information received by those authorities, bodies andpersons shall be subject to the conditions of professional secrecy laiddown in paragraph 1.
5a. Notwithstanding paragraphs 1 to 4, Member States may
authorize exchanges of information between the competent authoritiesand:
— the authorities responsible for overseeing the bodies involved in the
liquidation and bankruptcy of insurance undertakings and other
similar procedures, or
— the authorities responsible for overseeing the persons charged with
carrying out statutory audits of the accounts of insurance undertak-ings, credit institutions, investment firms and other financialinstitutions, or
— independent actuaries of insurance undertakings carrying out legal
supervision of those undertakings and the bodies responsible foroverseeing such actuaries.
Die Mitgliedstaaten, die von der Möglichkeit des Unterabsatzes 1
Gebrauch machen, verlangen zumindest, daß folgende Bedingungenerfüllt werden:
— this information shall be for the purpose of carrying out the over-
seeing or legal supervision referred to in the first subparagraph,
— information received in this context will be subject to the conditions
of professional secrecy imposed in paragraph 1,
— where the information originates in another Member State, it may
not be disclosed without the express agreement of the competent
authorities which have disclosed it and, where appropriate, solelyfor the purposes for which those authorities gave their agreement.
Member States shall communicate to the Commission and to the other
Member States the names of the authorities, person and bodies whichmay receive information pursuant to this paragraph.
5b. Notwithstanding paragraphs 1 to 4, Member States may, with
the aim of strengthening the stability, including integrity, of the finan-cial system, authorize the exchange of information between thecompetent authorities and the authorities or bodies responsible underthe law for the detection and investigation of breaches of company law.
Member States which have recourse to the option provided for in the
first subparagraph shall require at least that the following conditons
are met:
— the information shall be for the purpose of performing the task
referred to in the first subparagraph,
— information received in this context shall be subject to the condi-
tions of professional secrecy imposed in paragraph 1,
— where the information originates in another Member State, it may
not be disclosed without the express agreement of the competent
authorities which have disclosed it and, where appropriate, solely
for the purposes for which those authorities gave their agreement.
Where, in a Member State, the authorities or bodies referred to in the
first subparagraph perform their task of detection or investigation withthe aid, in view of their specific competence, of persons appointed forthat purpose and not employed in the public sector, the possibility of
exchanging information provided for in the first subparagraph may be
extended to such persons under the conditions stipulated in the secondsubparagraph.
In order to implement the final indent of the second subparagraph, the
authorities or bodies referred to in the first subparagraph shall commu-nicate to the competent authorities which have disclosed the1992L0049 — EN — 11.02.2003 — 003.001 — 16
▼M1
▼M1
information, the names and precise responsibilities of the persons to
whom it is to be sent.
Member States shall communicate to the Commission and to the other
Member States the names of the authorities or bodies which may
receive information pursuant to this paragraph.
Before 31 December 2000, the Commission shall draw upa rep ort on
the application of the provisions of this paragraph.
5c. This Article shall not prevent a competent authority from trans-
mitting
— to central banks and other bodies with a similar function in their
capacity as monetary authorities,
— where appropriate, to other public authorities responsible for over-
seeing payment systems,
information intended for the performance of their task, nor shall it
prevent such authorities or bodies from communicating to the compe-tent authorities such information as they may need for the purposes ofparagraph 4. Information received in this context shall be subject to theconditions of professional secrecy imposed in this Article.
6. In addition, notwithstanding paragraphs 1 and 4, the Member
States may, under provisions laid down by law, authorize the disclosure
of certain information to other departments of their central governmentadministrations responsible for legislation on the supervision of creditinstitutions, financial institutions, investment services and insurancecompanies and to inspectors acting on behalf of those departments.
However, such disclosures may be made only where necessary for
reasons of prudential control.
The Member States shall, however, provide that information received
under paragraphs 2 and 5 and that obtained by means of the on-the-
spot verification referred to in Article 14 of Directive 73/239/EECmay never be disclosed in the cases referred to in this paragraph exceptwith the express consent of the competent authorities which disclosedthe information or of the competent authorities of the Member State inwhich on-the-spot verification was carried out.
Article 16a
1. Member States shall provide at least that:
(a) any person authorized within the meaning of Directive 84/253/
EEC (
1), performing in an insurance undertaking the task described
in Article 51 of Directive 78/660/EEC (2), Article 37 of Directive
83/349/EEC or Article 31 of Directive 85/611/EEC or any otherstatutory task, shall have a duty to report promptly to the compe-tent authorities any fact or decision concerning that undertaking ofwhich he has become aware while carrying out that task which is
liable to:
— constitute a material breach of the laws, regulations or adminis-
trative provisions which lay down the conditions governingauthorization or which specifically govern pursuit of the activ-
ities of insurance undertaking, or
— affect the continuous functioning of the insurance undertaking,
or
— lead to refusal to certify the accounts or to the expression of
reservations;1992L0049 — EN — 11.02.2003 — 003.001 — 17
(1) OJ No L 126, 12. 5. 1984, p. 20.
(2) OJ No L 222, 14. 8. 1978, p. 11. Directive as last amended by Directive 90/
605/EEC (OJ No L 317, 16. 11. 1990, p. 60).▼M3
▼B
▼M1
▼M1
(b) that person shall likewise have a duty to report any facts and deci-
sions of which he becomes aware in the course of carrying out atask as described in (a) in an undertaking having close links
resulting from a control relationshipwith the insurance undertaking
within which he is carrying out the abovementioned task.
2. The disclosure in good faith to the competent authorities, by
persons authorized within the meaning of Directive 84/253/EEC, ofany fact or decision referred to in paragraph 1 shall not constitute a
breach of any restriction on disclosure of information imposed by
contract of by any legislative, regulatory or administrative provisionand shall not involce such persons in liability of any kind.
Chapter2
Article 17
Article 15 of Directive 73/239/EEC shall be replaced by the following:
‘Article 15
1. The home Member State shall require every insurance under-
taking to establish adequate technical provisions in respect of its
entire business.
The amount of such technical provisions shall be determined in
accordance with the rules laid down in Directive 91/674/EEC.
2. The home Member State shall require every insurance under-
taking to cover the technical provisions in respect of its entire
business by matching assets in accordance with Article 6 of Direc-
tive 88/357/EEC. In respect of risks situated within the EuropeanCommunity, those assets must be localized within the Community.Member States shall not require insurance undertakings to localizetheir assets in any particular Member State. The home MemberState may, however, permit relaxations in the rules on the localiza-
tion of assets.
3. If the home Member State allows any technical provisions to
be covered by claims against reinsurers, it shall fix the percentage
so allowed. In such cases, it may not specify the localization of the
assets representing such claims.’
Article 18
Article 15a of Directive 72/239/EEC shall be replaced by the
following:
‘Article 15a
1. Member States shall require every insurance undertaking with
a head office within their territories which underwrites risksincluded in class 14 in point A of the Annex (hereinafter referredto as “credit insurance”) to set upan equalization reserve for the
purpose of offsetting any technical deficit or above-average claims
ration arising in that class in any financial year.
2. The equalization reserve shall be calculated in accordance
with the rules laid down by the home Member State in accordance
with one of the four methods set out in point D of the Annex,which shall be regarded as equivalent.
3. Upto the amount calculated in accordance with the methods
set out in point D of the Annex, the equalization reserve shall bedisregarded for the purpose of calculating the solvency margin.
4. Member States may exempt insurance undertakings with head
offices within their territories from the obligation to set upequali-zation reserves for credit insurance business where the premiums orcontributions receivable in respect of credit insurance are less than4 % of the total premiums or contributions receivable by them andless than ECU 2 500 000.’1992L0049 — EN — 11.02.2003 — 003.001 — 18
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Article 19
Article 23 of Directive 88/357/EEC is hereby repealed.
Article 20
The assets covering the technical provisions shall take account of the
type of business carried on by an undertaking in such a way as to
secure the safety, yield and marketability of its investments, which theundertaking shall ensure are diversified and adequately spread.
Article 21
1. The home Member State may not authorize insurance undertak-
ings to cover their technical provisions with any but the followingcategories of assets:
A.Investments
(a) debt securities, bonds and other money and capital market
instruments;
(b) loans;
(c) shares and other variable yield participations;
(d) units in undertakings for collective investment in transferable
securities and other investment funds;
(e) land, buildings and immovable property rights;
B.Debtsandclaims
(f) debts owed by reinsurers, including reinsurers' shares of tech-
nical provisions;
(g) deposits with and debts owed by ceding undertakings;
(h) debts owed by policyholders and intermediaries arising out of
direct and reinsurance operations;
(i) claims arising out of salvage and subrogation;
(j) tax recoveries;
(k) claims against guarantee funds;
C.Others
(l) tangible fixed assets, other than land and buildings, valued on
the basis of prudent amortization;
(m) cash at bank and in hand, deposits with credit institutions and
any other bodies authorized to receive deposits;
(n) deferred acquisition costs;(o) accrued interest and rent, other accrued income and prepay-
ments;
In the case of the association of underwriters know as Lloyd's, asset
categories shall also include guarantees and letters of credit issued by
credit institutions within the meaning of Directive 77/780/EEC (
1)o rb y
assurance undertakings, together with verifiable sums arising out of lifeassurance policies, to the extent that they represent funds belonging tomembers.
The inclusion of any asset or category of assets listed in the first
subparagraph shall not mean that all categories of assets must automa-tically be accepted as cover for technical provisions. The homeMember State shall lay down more detailed rules fixing the conditions
for the use of acceptable assets; in this connection, it may require valu-
able security or guarantees, particularly in the case of debts owed byreinsurers.1992L0049 — EN — 11.02.2003 — 003.001 — 19
(1) OJ No L 322, 17. 12. 1977, p. 30. Last amended by Directive 89/646/EEC
(OJ No L 386, 30. 12. 1989, p. 1).
▼B
In the determination and the application of the rules which it lays
down, the home Member State shall, in particular, ensure that thefollowing principles are complied with:
(i) assets covering technical provisions shall be valued net of any
debts arising out of their acquisition;
(ii) all assets must be valued on a prudent basis, allowing for the risk
of any amounts' not being realizable. In particular, tangible fixed
assets other than land and buildings may be accepted as cover fortechnical provisions only if they are valued on the basis ofprudent amortization;
(iii) loans, whether to undertakings, to State authorities or interna-
tional organizations, to local or regional authorities or to naturalpersons, may be accepted as cover for technical provisions only
if there are sufficient guarantees as to their security, whether
these are based on the status of the borrower, mortgages, bankguarantees or guarantees granted by insurance undertakings orother forms of security;
(iv) derivative instruments such as options, futures and swaps in
connection with assets covering technical provisions may be
used in so far as they contribute to a reduction of investment
risks or facilitate efficient portfolio management. They must bevalued on a prudent basis and may be taken into account in thevaluation of the underlying assets;
(v) transferrable securities which are not dealt in on a regulated
market may be accepted as cover for technical provisions only
if they can be realized in the short term;
(vi) debts owed by and claims against a third party may be accepted
as cover for technical provisions only after deduction of allamounts owed to the same third party;
(vii) the value of any debts and claims accepted as cover for technical
provisions must be calculated on a prudent basis, with due allow-ance for the risk of any amounts not being realizable. Inparticular, debts owed by policyholders and intermediaries arising
out of insurance and reinsurance operations may be accepted
only in so far as they have been outstanding for not more thanthree months;
(viii) where the assets held include an investment in a subsidiary
undertaking which manages all or part of the insurance undertak-ing's investments on its behalf, the home Member State must,
when applying the rules and principles laid down in this Article,
take into account the underlying assets held by the subsidiaryundertaking; the home Member State may treat the assets ofother subsidiaries in the same way;
(ix) deferred acquisition costs may be accepted as cover for technical
provisions only to the extent that that is consistent with the calcu-
lation of the technical provision for unearned premiums.
2. Notwithstanding paragraph 1, in exceptional circumstances and at
an insurance undertaking's request, the home Member State may,temporarily and under a properly reasoned decision, accept other cate-gories of assets as cover for technical provisions, subject to Article 20.
Article 22
1. As regard the assets covering technical provisions, the home
Member State shall require every insurance undertaking to invest nomore than:
(a) 10 % of its total gross technical provisions in any one piece of land
or building, or a number of pieces of land or buildings close
enough to each other to be considered effectively as one invest-ment;
(b) 5 % of its total gross technical provisions in shares and other nego-
tiable securities treated as shares, bonds, debt securities and othermoney and capital market instruments from the same undertaking,or in loans granted to the same borrower, taken together, the loansbeing loans other than those granted to a State, regional or localauthority or to an international organization of which one or more1992L0049 — EN — 11.02.2003 — 003.001 — 20
▼B
Member States are members. This limit may be raised to 10 % if
an undertaking does not invest more than 40 % of its gross tech-nical provisions in the loans or securities of issuing bodies and
borrowers in each of which it invests more than 5 % of its assets;
(c) 5 % of its total gross technical provisions in unsecured loans,
including 1 % for any single unsecured loan, other than loansgranted to credit institutions, assurance undertaking - in so far as
Article 8 of Directive 73/239/EEC allows it - and investment
undertakings established in a Member State;
(d) 3 % of its total gross technical provisions in the form of cash in
hand;
(e) 10 % of its total gross technical provisions in shares, other securi-
ties treated as shares and debt securities, which are not dealt in ona regulated market.
2. The absence of a limit in paragraph 1 on investment in any parti-
cular category does not imply that assets in that category should be
accepted as cover for technical provisions without limit. The homeMember State shall lay down more detailed rules fixing the conditionsfor the use of acceptable assets. In particular it shall ensure, in thedetermination and the application of those rules, that the followingprinciples are complied with:
(i) assets covering technical provisions must be diversified and spread
in such a way as to ensure that there is no excessive reliance onany particular category of asset, investment market or investment;
(ii) investment in particular types of asset which show high levels of
risk, whether because of the nature of the asset or the quality ofthe issuer, must be restricted to prudent levels;
(iii) limitations on particular categories of asset must take account of
the treatment of reinsurance in the calculation of technical provi-
sions;
(iv) where the assets held include an investment in a subsidiary under-
taking which manages all or part of the insurance undertaking'sinvestments on its behalf, the home Member State must, whenapplying the rules and principles laid down in this Article, takeinto account the underlying assets held by the subsidiary under-taking; the home Member State may treat the assets of other
subsidiaries in the same way;
(v) the percentage of assets covering technical provisions which are
the subject of non-liquid investments must be kept to a prudent
level;
(vi) where the assets held include loans to or debt securities issued by
certain credit institutions, the home Member State may, whenapplying the rules and principles laid down in this Article, takeinto account the underlying assets held by such credit institutions.This treatment may be applied only where the credit institution has
its head office in a Member State, is entirely owned by that
Member State and/or that State's local authorities and its business,according to its memorandum and articles of association, consistsof extending, through its intermediary, loans to or guaranteed bythe State or local authorities or loans to bodies closely linked tothe State or to local authorities.
3. In the context of the detailed rules laying down the conditions for
the use of acceptable assets, the Member State shall give more limita-tive treatment to:
— any loan unaccompanied by a bank guarantee, a guarantee issued
by an insurance undertaking, a mortgage or any other form of
security, as compared with loans accompanied by such collateral,
— Ucits not coordinated within the meaning of Directive 85/611/
EEC (
1) and other investment funds, as compared with Ucits coordi-
nated within the meaning of that Directive,1992L0049 — EN — 11.02.2003 — 003.001 — 21
(1) OJ No L 375, 31. 12. 1985, p. 3. Amended by Directive 88/220/EEC (OJ No
L 100, 19. 4. 1988, p. 31).
▼B
— securities which are not dealt in on a regulated market, as compared
with those which are,
— bonds, debt securities and other money and capitalmarket instru-
ments not issued by States, local or regional authorities or
undertakings belonging to Zone A as defined in Directive 89/647/
EEC (1), or the issuers of which are international organizations not
numbering at least one Community Member State among theirmember, as compared with the same financial instruments issuedby such bodies.
4. Member States may raise the limit laid down in paragraph 1 (b)
to 40 % in the case of certain debt securities when these are issued by
a credit institution which has its head office in a Member State and issubject by law to special official supervision designed to protect theholders of those debt securities. In particular, sums deriving from theissue of such debt securities must be invested in accordance with thelaw in assets which, during the whole period of validity of the debt
securities, are capable of covering claims attaching to the debt securi-
ties and which, in the event of failure of the issues, would be used on apriority basis for the reimbursement of the principal and payment ofthe accrued interest.
5. Member States shall not require insurance undertakings to invest
in particular categories of assets.
6. Notwithstanding paragraph 1, in exceptional circumstances and at
an insurance undertaking's request, the home Member State may,
temporarily and under a properly reasoned decision, allow exceptionsto the rules laid down in paragraph 1 (a) to (e), subject to Article 20.
Article 23
Points 8 and 9 of Annex 1 to Directive 88/357/EEC shall be replaced
by the following:
‘8. Insurance undertakings may hold non-matching assets to cover
an amount not exceeding 20 % of their commitments in a parti-cular currency.
9. A Member State may provide that when under the preceding
procedures a commitment must be covered by assets expressed
in a Member State's currency that requirement shall also beconsidered as satisfied when the assets are expressed in ecus’.
Article 24
Article 16 (1) of Directive 73/239/EEC shall be replaced by the
following:
‘1. The home Member State shall require every insurance under-
taking to establish an adequate solvency margin in respect of itsentire business.
The solvency margin shall correspond to the assets of the under-
taking free of any foreseeable liabilities less any intangible items.
In particular the following shall be included:
— the paid-up share capital or, in the case of a mutual insurance
undertaking, the effective initial fund plus any members'
accounts which meet all the following criteria:
(a) the memorandum and articles of association must stipulate
that payments may be made from these accounts tomembers only insofar as this does not cause the solvencymargin to fall below the required level, or, after the dissolu-tion of the undertaking, if all the undertaking's other debts
have been settled;
(b) the memorandum and articles of association must stipulate,
with respect to any such payments for reasons other than theindividual termination of membership, that the competent1992L0049 — EN — 11.02.2003 — 003.001 — 22
(1) OJ No L 386, 30. 12. 1989, p. 14.
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authorities must be notified at least one month in advance
and can prohibit the payment within that period and
(c) the relevant provisions of the memorandum and articles of
association may be amended only after the competentauthorities have declared that they have no objection to the
amendment, without prejudice to the criteria stated in (a)
and (b);
— one-half of the unpaid share capital or initial fund, once the
paid-up part amounts to 25 % of that share capital or fund,
— reserves (statutory reserves and free reserves) not corresponding
to underwriting liabilities,
— any profits brought forward,— in the case of mutual or mutal-type association with variable
contributions, any claim which it has against its members by
way of a call for supplementary contribution, within the finan-cial year, upto one-half of the difference between themaximum contributions and the contributions actually calledin, and subject to a limit of 50 % of the margin,
— at the request of and on the production of proof by the insur-
ance undertaking, any hidden reserves arising out of the
undervaluation of assets, insofar as those hidden reserves arenot of an exceptional nature,
— cumulative preferential share capital and subordinated loan
capital may be included but, if so, only up to 50 % of themargin, no more than 25 % of which shall consist of subordi-
nated loans with a fixed maturity, or fixed-term cumulative
preferential share capital, if the following minimum criteria aremet:
(a) in the event of the bankruptcy or liquidation of the insur-
ance undertaking, binding agreements must exist under
which the subordinated loan capital or preferential sharecapital ranks after the claims of all other creditors and isnot to be repaid until all other debts outstanding at thetime have been settled.
Subordinated loan capital must fulfil the following additional
conditions:
(b) only fully paid-up funds may be taken into account;
(c) for loans with a fixed maturity, the original maturity must
be at least five years. No later than one year before therepayment date the insurance undertaking must submit tothe competent authorities for their approval a plan showinghow the solvency margin will be kept at or brought to therequired level at maturity, unless the extent to which the
loan may rank as a component of the solvency margin is
gradually reduced during at least the last five years beforethe repayment date. The competent authorities mayauthorize the early repayment of such loans provided appli-cation is made by the issuing insurance undertaking and its
solvency margin will not fall below the required level;
(d) loans the maturity of which is not fixed must be repayable
only subject to five years' notice unless the loans are no
longer considered a component of the solvency margin or
unless the prior consent of the competent authorities isspecifically required for early repayment. In the latter eventthe insurance undertaking must notify the competent autho-rities at least six months before the date of the proposedrepayment, specifying the actual and required solvency
margins both before and after that repayment. The compe-
tent authorities shall authorize repayment only if theinsurance undertaking's solvency margin will not fall belowthe required level;
(e) the loan agreement must not include any clause providing
that in specified circumstances, other than the winding-upof the insurance undertaking, the debt will become repay-able before the agreed repayment dates;1992L0049 — EN — 11.02.2003 — 003.001 — 23
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(f) the loan agreement may be amended only after the compe-
tent authorities have declared that they have no objection tothe amendment;
— securities with no specified maturity date and other instruments
that fulfil the following conditions, including cumulative prefer-ential shares other than those mentioned in the preceding indent,upto 50 % of the margin for the total of such securities and thesubordinated loan capital referred to in the preceding indent:
(a) they may not be repaid on the initiative of the bearer or
without the prior consent of the competent authority;
(b) the contract of issue must enable the insurance undertaking
to defer the payment of interest on the loan;
(c) the lender's claims on the insurance undertaking must rank
entirely after those of all non-subordinated creditors;
(d) the documents governing the issue of the securities must
provide for the loss-absorption capacity of the debt andunpaid interest, while enabling the insurance undertakingto continue its business;
(e) only fully paid-up amounts may be taken into account.’
Article 25
No more than three years after the date of application of this Directive
the Commission shall submit a report to the Insurance Committee onthe need for further harmonization of the solvency margin.
Article 26
Article 18 of Directive 79/239/EEC shall be replaced by the following:
‘Article 18
1. Member States shall not prescribe any rules as to the choice
of the assets that need not be used as cover for the technical provi-
sions referred to in Article 15.
2. Subject to Article 15 (2), Article 20 (1), (2), (3) and (5) and
the last subparagraph of Article 22 (1), Member States shall notrestrain the free disposal of those assets, whether movable orimmovable, that form part of the assets of authorized insuranceundertakings.
3. Paragraphs 1 and 2 shall not preclude any measures which
Member States, while safeguarding the interests of the isured
persons, are entitled to take as owners or members of or partners
to the undertakings in question.’
Chapter3
Article 27
Article 7 (1) (f) of Directive 88/357/EEC shall be replaced by the
following:
‘(f) in the case of the risks referred to in Article 5 (d) of Directive
73/239/EEC, the parties to the contract may choose any law.’
Article 28
The Member State in which a risk is situated shall not prevent a policy-
holder from concluding a contract with an insurance undertakingauthorized under the conditions of Article 6 of Directive 73/239/EEC,as long as that does not conflict with legal provisions protecting thegeneral good in the Member State in which the risk is situated.
Article 29
Member States shall not adopt provisions requiring the prior approval
or systematic notification of general and special policy conditions,scales of premiums, or forms and other printed documents which an1992L0049 — EN — 11.02.2003 — 003.001 — 24
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insurance undertaking intends to use in its dealings with policy-holders.
They may only require non-systematic notification of those policyconditions and other documents for the purpose of verifying compli-
ance with national provisions concerning insurance contracts, and that
requirement may not constitute a prior condition for an undertaking'scarrying on its business.
Member States may not retain or introduce prior notification or
approval of proposed increases in premium rates except as part of
general price-control systems.
Article 30
1. Article 8 (4) (b) of Directive 88/357/EEC shall be deleted. Article
8 (4) (a) of that Directive shall therefore be amended to read as
follows:
‘(a) Subject to subparagraph (c), the third subparagraph of Article
7 (2) shall apply where the insurance contract provides coverin two or more Member States, at least one of which makesinsurance compulsory.’
2. Notwithstanding any provision to the contrary, a Member State
which makes insurance compulsory may require that the general andspecial conditions of the compulsory insurance be communicated toits competent authority before being circulated.
Article 31
1. Before an insurance contract is concluded the insurance under-
taking shall inform the policyholder of:
— the law applicable to the contract where the parties do not have a
free choice, or the fact that the parties are free to choose the lawapplicable and, in the latter case, the law the insurer proposes tochoose,
— the arrangements for handling policyholders' complaints concerning
contracts including, where appropriate, the existence of acomplaints body, without prejudice to the policyholders's right totake legal proceedings.
2. The obligation referred to in paragraph 1 shall apply only where
the policyholder is a natural person.
3. The rules for implementing this Article shall be determined in
accordance with the law of the Member State in which the risk is situ-ated.
TITLE IV
PROVISIONSRELATINGTORIGHTOFESTABLISHMENTANDTHE
FREEDOMTOPROVIDESERVICES
Article 32
Article 10 of Directive 73/239/EEC shall be replaced by the following:
‘Article 10
1. An insurance undertaking that proposes to establish a branch
within the territory of another Member State shall notify the
competent authorities of its home Member State.
2. The Member States shall require every insurance undertaking
that proposes to establish a branch within the territory of another
Member State to provide the following information when effectingthe notification provided for in paragraph 1:
(a) the Member State within the territory of which it proposes to
establish a branch;
(b) a scheme of operations setting out, inter alia, the types of busi-
ness envisaged and the structural organization of the branch;
(c) the address in the Member State of the branch from which
documents may be obtained and to which they may be deliv-1992L0049 — EN — 11.02.2003 — 003.001 — 25
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ered, it being understood that that address shall be the one to
which all communications to the authorized agent are sent;
(d) the name of the branch's authorized agent, who must possess
sufficient powers to bind the undertaking in relation to thirdparties and to represent it in relations with the authorities andcourts of the Member State of the branch. With regard toLloyd's, in the event of any litigation in the Member State of
the branch arising out of underwritten commitments, the
insured persons must not be treated less favourably than if thelitigation had been brought against businesses of a conventionaltype. The authorized agent must, therefore, possess sufficientpowers for proceedings to be taken against him and must inthat capacity be able to bind the Lloyd's underwriters
concerned.
Where the undertaking intends its branch to cover risks in class 10
of point A of the Annex, not including carrier's liability, it mustproduce a declaration that it has become a member of the nationalbureau and the national guarantee fund of the Member State of the
branch.
3. Unless the competent authorities of the home Member State
have reason to doubt the adequacy of the administrative structureor the financial situation of the insurance undertaking or the goodrepute and professional qualifications or experience of the directors
or managers or the authorized agent, taking into account the busi-
ness planned, they shall within three months of receiving all theinformation referred to in paragraph 2 communicate that informa-tion to the competent authorities of the Member State of thebranch and shall inform the undertaking concerned accordingly.
The competent authorities of the home Member State shall also
attest that the insurance undertaking has the minimum solvencymargin calculated in accordance with Articles 16 and 17.
Where the competent authorities of the home Member State refuse
to communicate the information referred to in paragraph 2 to the
competent authorities of the Member State of the branch they shall
give the reasons for their refusal to the undertaking concernedwithin three months of receiving all the information in question.That refusal or failure to act may be subject to a right to apply tothe courts in the home Member State.
4. Before the branch of an insurance undertaking starts business,
the competent authorities of the Member State of the branch shall,within two months of receiving the information referred to in para-graph 3, inform the competent authority of the home Member State,if appropriate, of the conditions under which, in the interest of the
general good, that business must be carried on in the Member State
of the branch.
5. On receiving a communication from the competent authorities
of the Member State of the branch or, if no communication isreceived from them, on expiry of the period provided for in para-
graph 4, the branch may be established and start business.
6. In the event of a change in any of the particulars communi-
cated under paragraph 2 (b), (c) or (d), an insurance undertakingshall give written notice of the change to the competent authoritiesof the home Member State and of the Member State of the branch
at least one month before making the change so that the competent
authorities of the home Member State and the competent authoritiesof the Member State of the branch may fulfil their respective rolesunder paragraphs 3 and 4.’
Article 33
Article 11 of Directive 73/239/EEC is hereby repealed.
Article 34
Article 14 of Directive 88/357/EEC shall be replaced by the following:1992L0049 — EN — 11.02.2003 — 003.001 — 26
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‘Article 14
Any undertaking that intends to carry on business for the first time
in one or more Member States under the freedom to provide
services shall first inform the competent authorities of the home
Member State, indicating the nature of the risks it proposes tocover.’
Article 35
Article 16 of Directive 88/357/EEC shall be replaced by the following:
‘Article 16
1. Within one month of the notification provided for in Article
14, the competent authorities of the home Member State shallcommunicate to the Member State or Member States within theterritories of which an undertaking intends to carry on businessunder the freedom to provide services:
(a) a certificate attesting that the undertaking has the minimum
solvency margin calculated in accordance with Articles 16 and
17 of Directive 73/239/EEC;
(b) the classes of insurance which the undertaking has been author-
ized to offer;
(c) the nature of the risks which the undertaking proposes to cover
in the Member State of the provision of services.
At the same time, they shall inform the undertaking concerned
accordingly.
Each Member State within the territory of which an undertaking
intends, under the freedom to provide services, to cover risks in
class 10 of point A of the Annex to Directive 73/239/EEC other
than carrier's liability may require that the undertaking:
— communicate the name and address of the representative
referred to in Article 12a (4) of this Directive,
— produce a declaration that the undertaking has become a
member of the national bureau and national guarantee fund of
the Member State of the provision of services.
2. Where the competent authorities of the home Member State
do not communicate the information referred to in paragraph 1within the period laid down, they shall give the reasons for theirrefusal to the undertaking within that same period. That refusal
shall be subject to a right to apply to the courts in the home
Member State.
3. The undertaking may start business on the certified date on
which it is informed of the communication provided for in the firstsubparagraph of paragraph 1.’
Article 36
Article 17 of Directive 88/357/EEC shall be replaced by the following:
‘Article 17
Any change which an undertaking intends in make to the informa-
tion referred to in Article 14 shall be subject to the procedureprovided for in Articles 14 and 16.’
Article 37
Article 12 (2), second and third subparagraphs, Article 12 (3) and Arti-
cles 13 and 15 of Directive 88/357/EEC are hereby repealed.
Article 38
The competent authorities of the Member State of the branch or the
Member State of the provision of services may require that the infor-mation which they are authorized under this Directive to request withregard to the business of insurance undertakings operating in the terri-1992L0049 — EN — 11.02.2003 — 003.001 — 27
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tory of that State shall be supplied to them in the official language or
languages of that State.
Article 39
1. Article 18 of Directive 88/357/EEC is hereby repealed.
2. The Member State of the branch or of the provision of services
shall not adopt provisions requiring the prior approval or systematicnotification of general and special policy conditions, scales ofpremiums, or forms and other printed documents which an undertakingintends to use in its dealings with policyholders. It may only require an
undertaking that proposes to carry on insurance business within its
territory, under the right of establishment or the freedom to provideservices, to effect non-systematic notification ot those policy conditionsand other documents for the purpose of verifying compliance with itsnational provisions concerning insurance contracts, and that require-ment may not constitute a prior condition for an undertaking's
carrying on its business.
3. The Member State of the branch or of the provision of services
may not retain or introduce prior notification or approval of proposedincreases in premium rates except as part of general price-control
systems.
Article 40
1. Article 19 of Directive 88/357/EEC is hereby repealed.
2. Any undertaking carrying on business under the right of establish-
ment or the freedom to provide services shall submit to the competentauthorities of the Member State of the branch and/or of the MemberState of the provision of services all documents requested of it for the
purposes of this Article in so far as undertakings with head offices in
those Member States are also obliged to do so.
3. If the competent authorities of a Member State establish that an
undertaking with a branch or carrying on business under the freedom
to provide services within its territory is not complying with the legalprovisions applicable to it in that State, they shall require the under-taking concerned to remedy that irregular situation.
4. If the undertaking in question fails to take the necessary action,
the competent authorities of the Member State concerned shall informthe competent authorities of the home Member State accordingly. Thelatter authorities shall, at the earliest opportunity, take all appropriatemeasures to ensure that the undertaking concerned remedies that irre-gular situation. The nature of those measures shall be communicated
to the competent authorities of the Member State concerned.
5. If, despite the measures taken by the home Member State or
because those measures prove inadequate or are lacking in that State,the undertaking persists in infringing the legal provisions in force in
the Member State concerned, the latter may, after informing the
competent authorities of the home Member State, take appropriatemeasures to prevent or penalize further infringements, including, in sofar as is strictly necessary, preventing that undertaking from continuingto conclude new insurance contracts within its territory. Member States
shall ensure that within their territories it is possible to serve the legal
documents necessary for such measures on insurance undertakings.
6. Paragraphs 3, 4 and 5 shall not affect the emergency power of the
Member States concerned to take appropriate measures to prevent irre-
gularities within their territories. This shall include the possibility of
preventing insurance undertakings from continuing to conclude newinsurance contracts within their territories.
7. Paragraphs 3, 4 and 5 shall not affect the powers of the Member
States to penalize infringements within their territories.
8. If an undertaking which has committed an infringement has an
establishment or possesses property in the Member State concerned,the competent authorities of the latter may, in accordance with national1992L0049 — EN — 11.02.2003 — 003.001 — 28
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law, apply the administrative penalties prescribed for that infringement
by way of enforcement against that establishment or property.
9. Any measure adopted under paragraphs 4 to 8 involving penalties
or restrictions on the conduct of insurance business must be properly
reasoned and communicated to the undertaking concerned.
10. Every two years, the Commission shall submit to the Insurance
Committee set upby Directive 91/675/EEC a rep ort summarizing thenumber and types of cases in which, in each Member State, authoriza-tion has been refused under Article 10 of Directive 73/239/EEC or
Article 16 of Directive 88/357/EEC as amended by this Directive or
measures have been taken under paragraph 5. Member States shallcooperate with the Commission by providing it with the informationrequired for that report.
Article 41
Nothing in this Directive shall prevent insurance undertakings with
head offices in Member States from advertising their services, through
all available means of communication, in the Member State of the
branch or the Member State of the provision of services, subject toany rules governing the form and content of such advertising adoptedin the interest of the general good.
Article 42
1. Article 20 of Directive 88/357/EEC is hereby repealed.2. In the event of an insurance undertaking's being wound up,
commitments arising out of contracts underwritten through a branch
or under the freedom to provide services shall be met in the sameway as those arising out of that undertaking's other insurance contracts,without distinction as to nationality as far as the persons insured andthe beneficiaries are concerned.
Article 43
1. Article 21 of Directive 88/357/EEC is hereby repealed.
2. Where insurance is offered unter the right of establishment or the
freedom to provide services, the policyholder shall, before any commit-ment is entered into, be informed of the Member State in which thehead office or, where appropriate, the branch with which the contractis to be concluded is situated.
Any documents issued to the policyholder must convey the information
referred to in the first subparagraph.
The obligations imposed in the first two subparagraphs shall not apply
to the risks referred to in Article 5 (d) of Directive 73/239/EEC.
3. The contract or any other document granting cover, together with
the insurance proposal where it is binding upon the policyholder, muststate the address of the head office, or, where appropriate, of the
branch of the insurance undertaking which grants the cover.
Each Member State may require that the name and address of the
representative of the insurance undertaking referred to in Article 12 a(4) of Directive 88/357/EEC also appear in the documents referred toin the first subparagraph.
Article 44
1. Article 22 of Directive 88/357/EEC is hereby repealed.
2. Every insurance undertaking shall inform the competent authority
of its home Member State, separately in respect of transactions carriedout under the right of establishment and those carried out under thefreedom to provide services, of the amount of the premiums, claimsand commissions, without deduction of reinsurance, by Member Stateand by groupof classes, and also as regards class 10 of p oint A of1992L0049 — EN — 11.02.2003 — 003.001 — 29
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the Annex to Directive 73/239/EEC, not including carrier's liability, the
frequency and average cost of claims.
The groups of classes are hereby defined as follows:
— accident and sickness (classes 1 and 2),
— motor (classes 3, 7 and 10, the figures for class 10, excluding
carriers' liability, being given separately),
— fire and other damage to property (classes 8 and 9),
— aviation, marine and transport (classes 4, 5, 6, 7, 11 and 12),
— general liability (class 13),
— credit and suretyship(classes 14 and 15),
— other classes (classes 16, 17 and 18).
The competent authority of the home Member State shall forward that
information within a reasonable time and in aggregate form to the
competent authorities of each of the Member States concerned whichso request.
Article 45
1. Article 24 of Directive 88/357/EEC is hereby repealed.
2. Nothing in this Directive shall affect the Member States' right to
require undertakings carrying on business within their territories under
the right of establishment or the freedom to provide services to join
and participate, on the same terms as undertakings authorized there, inany scheme designed to guarantee the payment of insurance claims toinsured persons and injured third parties.
Article 46
1. Article 25 of Directive 88/357/EEC is hereby repealed.
2. Without prejudice to any subsequent harmonization, every insur-
ance contract shall be subject exclusively to the indirect taxes and
parafiscal charges on insurance premiums in the Member State in
which the risk is situated as defined in Article 2 (d) of Directive 88/357/EEC, and also, in the case of Spain, to the surcharges legallyestablished in favour of the Spanish ‘Consorcio de Compensación deSeguros’ for the performance of its functions relating to the compensa-tion of losses arising from extraordinary events occurring in that
Member State.
In derogation from the first indent of Article 2 (d) of Directive 88/357/
EEC, and for the purposes of this paragraph, moveable property
contained in a building situated within the territory of a Member State,except for goods in commercial transit, shall be a risk situated in thatMember State, even if the building and its contents are not covered bythe same insurance policy.
The law applicable to the contract under Article 7 of Directive 88/357/
EEC shall not affect the fiscal arrangements applicable.
Pending future harmonization, each Member State shall apply to those
undertakings which cover risks situated within its territory its ownnational provisions to ensure the collection of indirect taxes and paraf-
iscal charges due under the first subparagraph.
TITLE V
TRANSITIONALPROVISIONS
Article 47
The Federal Republic of Germany may postpone until 1 January 1996
the application of the first sentence of the second subparagraph ofArticle 54 (2). During that period, the provisions of the followingsubparagraph shall apply in the situation referred to in Article 54 (2).
When the technical basis for the calculation of premiums has been
communicated to the competent authorities of the home Member State1992L0049 — EN — 11.02.2003 — 003.001 — 30
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in accordance with the third sentence of the second subparagraph of
Article 54 (2), those authorities shall without delay forward that infor-mation to the competent authorities of the Member State in which the
risk is situated so that they may comment. If the competent authorities
of the home Member State take no account of those comments, theyshall inform the competent authorities of the Member State in whichthe risk is situated accordingly in detail and state their reasons.
Article 48
Member States may allow insurance undertakings with head offices in
their territories, the buildings and land of which that cover their tech-
nical provisions exceed, at the time of the notification of this Directive,the percentage laid down in Article 22 (1) (a), a period expiring nolater than 31 December 1998 within which to comply with that provi-sion.
Article 49
The Kingdom of Denmark may postpone until 1 January 1999 the
application of this Directive to compulsory insurance against accidentsat work. During that period the exclusion provided for in Article 12 (2)of Directive 88/357/EEC for accidents at work shall continue to applyin the Kingdom of Denmark.
Article 50
Spain, until 31 December 1996, and Greece and Portugal, until 31
December 1998, may operate the following transitional arrangementsfor contracts covering risks situated exclusively in one of thoseMember States other than those defined in Article 5 (d) of Directive73/239/EEC:
(a) in derogation from Article 8 (3) of Directive 73/239/EEC and from
Articles 29 and 39 of this Directive, the competent authorities of
the Member States in question may require the communication,before use, of general and special insurance policy conditions;
(b) the amount of the technical provisions relating to the contracts
referred to in this Article shall be determined under the supervisionof the Member State concerned in accordance with its own rules or,failing that, in accordance with the procedures established withinits territory in accordance with this Directive. Cover of those tech-nical provisions by equivalent and matching assets and the
localization of those assets shall be effected under the supervision
of that Member State in accordance with its rules and practicesadopted in accordance with this Directive.
TITLE VI
FINALPROVISIONS
Article 51
The following technical adjustments to be made to Directives 73/239/
EEC and 88/357/EEC and to this Directive shall be adopted in accor-dance with the procedure laid down in Directive 91/675/EEC:
— extension of the legal forms provided for in Article 8 (1) (a) of
Directive 73/239/EEC,
— amendments to the list set out in the Annex to Directive 73/239/
EEC, or adaptation of the terminology used in that list to take
account of the development of insurance markets,
— clarification of the items constituting the solvency margin listed in
Article 16 (1) of Directive 73/239/EEC to take account of the crea-tion of new financial instruments,
— alteration of the minimum guarantee fund provided for in Article 17
(2) of Directive 73/239/EEC to take account of economic and finan-cial developments,
— amendments, to take account of the creation of new financial instru-
ments, to the list of assets acceptable as cover for technical1992L0049 — EN — 11.02.2003 — 003.001 — 31
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provisions set out in Article 21 of this Directive and to the rules on
the spreading of investments laid down in Article 22,
— changes in the relaxations in the matching rules laid down in Annex
1 to Directive 88/357/EEC, to take account of the development ofnew currency-hedging instruments or progress made towards
economic and monetary union,
— clarification of the definitions in order to ensure uniform applica-
tion of Directives 73/239/EEC and 88/357/EEC and of this
Directive throughout the Community.
Article 52
1. Branches which have started business, in accordance with the
provisions in force in their Member State of establishment, before the
entry into force of the provisions adopted in implementation of this
Directive shall be presumed to have been subject to the procedure laiddown in Article 10 (1) to (5) of Directive 73/239/EEC. They shall begoverned, from the date of that entry into force, by Articles 15, 19, 20and 22 of Directive 73/239/EEC and by Article 40 of this Directive.
2. Articles 34 and 35 shall not affect rights acquired by insurance
undertakings carrying on business under the freedom to provideservices before the entry into force of the provisions adopted in imple-
mentation of this Directive.
Article 53
The following Article shall be inserted in Directive 73/239/EEC:
‘Article 28a
1. Under the conditions laid down by national law, each Member
State shall authorize agencies and branches set upwithin its terri-
tory and covered by this Title to transfer all or part of theirportfolios of contracts to an accepting office established in thesame Member State if the competent authorities of that MemberState or, if appropriate, of the Member State referred to in Article26 certify that after taking the transfer into account the accepting
office possesses the necessary solvency margin.
2. Under the conditions laid down by national law, each Member
State shall authorize agencies and branches set upwithin its terri-tory and covered by this Title to transfer all or part of theirportfolios of contracts to an insurance undertaking with a head
office in another Member State if the competent authorities of that
Member State certify that after taking the transfer into account theaccepting office possesses the necessary solvency margin.
3. If under the conditions laid down by national law a Member
State authorizes agencies and branches set upwithin its territory
and covered by this Title to transfer all or part of their portfolios
of contracts to an agency or branch covered by this Title and setupwithin the territory of another Member State it shall ensure thatthe competent authorities of the Member State of the acceptingoffice or, if appropriate, of the Member State referred to in Article
26 certify that after taking the transfer into account the accepting
office possesses the necessary solvency margin, that the law of theMember State of the accepting office permits such a transfer andthat that State has agreed to the transfer.
4. In the circumstances referred to in paragraphs 1, 2 and 3 the
Member State in which the transferring agency or branch is situated
shall authorize the transfer after obtaining the agreement of thecompetent authorities of the Member State in which the risks aresituated, where different from the Member State in which the trans-ferring agency or branch is situated.
5. The competent authorities of the Member States consulted
shall give their opinion or consent to the competent authorities ofthe home Member State of the transferring insurance undertakingwithin three months of receiving a request; the absence of anyresponse from the authorities consulted within that period shall beconsidered equivalent to a favourable opinion or tacit consent.1992L0049 — EN — 11.02.2003 — 003.001 — 32
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6. A transfer authorized in accordance with this Article shall be
published as laid down by national law in the Member State inwhich the risk is situated. Such transfers shall automatically be
valid against policyholders, insured persons and any other persons
having rights or obligations arising out of the contracts transferred.
This provision shall not affect the Member States' right to give
policyholders the option of cancelling contracts within a fixedperiod after a transfer.’
Article 54
1. Notwithstanding any provision to the contrary, a Member State in
which contracts covering the risks in class 2 of point A of the Annex toDirective 73/239/EEC may serve as a partial or complete alternative tohealth cover provided by the statutory social security system mayrequire that those contracts comply with the specific legal provisions
adopted by that Member State to protect the general good in that class
of insurance, and that the general and special conditions of that insur-ance be communicated to the competent authorities of that MemberState before use.
2. Member States may require that the health insurance system
referred to in paragraph 1 be operated on a technical basis similar tothat of life assurance where:
— the premiums paid are calculated on the basis of sickness tables and
other statistical data relevant to the Member State in which the riskis situated in accordance with the mathematical methods used ininsurance,
— a reserve is set upfor increasing age,
— the insurer may cancel the contract only within a fixed period deter-
mined by the Member State in which the risk is situated,
— the contract provides that premiums may be increased or payments
reduced, even for current contracts,
— the contract provides that the policyholder may change his existing
contract into a new contract complying with paragraph 1, offeredby the same insurance undertaking or the same branch and takingaccount of his acquired rights. In particular, account must be takenof the reserve for increasing age and a new medical examinationmay be required only for increased cover.
In that event, the competent authorities of the Member State concerned
shall publish the sickness tables and other relevant statistical datareferred to in the first subparagraph and transmit them to the competentauthorities of the home Member State. The premiums must be suffi-
cient, on rasonable actuarial assumptions, for undertakings to be able
to meet all their commitments having regard to all aspects of theirfinancial situation. The home Member State shall require that the tech-nical basis for the calculation of premiums be communicated to itscompetent authorities before the product is circulated. This paragraph
shall also apply where existing contracts are modified.
Article 55
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 concerningfinancial supervision, which shall be the exclusive responsibility ofthe home Member State.
Article 56
Member States shall ensure that decisions taken in respect of an insur-
ance undertaking under laws, regulations and administrative provisionsadopted in accordance with this Directive may be subject to the right toapply to the courts.1992L0049 — EN — 11.02.2003 — 003.001 — 33
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Article 57
1. The Member States shall adopt the laws, regulations and adminis-
trative provisions necessary for their compliance with this Directive not
later than 31 December 1993 and bring them into force no later than 1
July 1994. They shall forthwith inform the Commission thereof.
When they adopt such measures the Member States shall include refer-
ences to this Directive or shall make such references when they effectofficial publication. The manner in which such references are to bemade shall be laid down by the Member States.
2. The Member States shall communicate to the Commission the
texts of the main provisions of national law which they adopt in the
field covered by this Directive.
Article 58
This Directive is addressed to the Member States.1992L0049 — EN — 11.02.2003 — 003.001 — 34