The European Insurance and Occupational Pensions Authority (EIOPA) has published an Opinion on supervisory principles for captive insurers, seeking to ensure a high-quality and convergent supervision of captive (re)insurance undertakings.
The document, addressed to competent authorities, outlines the supervisory expectations while taking into account the specificities of captive (re)insurers’ business models.
It aims at facilitating a risk-based and proportionate supervision of captive (re)insurance undertakings and further supports the convergence of supervisory expectations in the context of creating a level playing field within the EU.
In addition, it sets out supervisory expectations in several areas, including intra-group transactions (especially cash pooling), the consistent application of the prudent person principle, and governance-related aspects.
Within the EU, Luxembourg and Ireland have established captive programmes. France has recently adopted new rules to welcome captives, while Italy is also seeking to attract captive corporations that are owned by Italian companies.
