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LR-Nr.: 961.01, art. 13-17

Law on Supervision

Art. 13

Application for Authorisation

1) Insurance undertakings wishing to obtain an authorisation for business activities must submit an application, together with the business plan, to the Supervisory Authority. This must contain the following details and proofs:

  • a) Extract from the Public Register according to which the undertaking is required to demonstrate the legal form of a company limited by shares or a co-operative;

    b) object and governing bodies of the undertaking, the object being restricted to insurance activities and to those transactions which are directly connected with this;

    c) necessary details on solvency and the submission of an activity plan as specified in Para. 2;

    d) Articles of Association;

    e) balance sheet, annual accounts or, if need be, the opening balance sheet and proof of the minimum sum for the guarantee fund;

    f) details of identity of and participations held by shareholders and members of co-operatives having a qualified participation in the insurance undertaking;

    g) proof of the professional qualifications and personal integrity of the company officers for the management of an insurance undertaking;

    h) details necessary for the assessment of the reliability and professional suitability of the actuary in the life insurance department responsible for actuarial matter;

    i) details of funds at the disposal of the undertaking for the performance of assistance services, insofar as an application is made for an authorisation to provide tourist assistance in the insurance branch;

    j) contracts or other agreements by which marketing, management assistance, the processing of benefits, accounting or assets administration is wholly or largely transferred to another undertaking (functional separation), although the head office of the insurance undertaking must remain in the Principality of Liechtenstein;

    k) declaration concerning membership of the Liechtenstein Insurance Office and the domestic guarantee fund insofar as an insurance undertaking intends to be active in the insurance branch of third-party liability for self-propelled land vehicles;

    l) submission of all other documents and details necessary for due supervision as demanded by the Supervisory Authority.

  • 2) The plan of action must contain details and proofs concerning the following points:

  • a) Planned insurance branches and type of risks which the insurance undertaking intends to cover;

    b) planned reinsurance and, for reinsurance undertakings, a retrocession plan;

    c) composition of the minimum guarantee fund;

    d) probable costs for establishing the administration, the agency network and the resources available for this (organisation fund);

    e) estimates for the first three years of business relating to commission expenditure and other administrative costs, probable premium and/or contribution income, probable expenditure for insurance cases and the probable liquidity situation;

    2. statements relating to the first three years of business concerning the financial resources available for covering obligations and the solvency margin.




    Art. 14

    Minimum Capital

    1) An insurance undertaking with its head office in the Principality of Liechtenstein must have a capital of which under all circumstances a minimum sum of 500,000 francs must be paid up.

    2) The Supervisory Authority shall determine in the individual case the necessary minimum capital which must be fully paid up and which it shall fix in consideration of the insurance branch in which the insurance undertaking intends to be active. It may adjust the minimum sum stated in Para. 1 to adapt to any possible fluctuations in monetary value.



    Art. 15

    Solvency Margin and Guarantee Fund

    1) Insurance undertakings must show free and unburdened own funds amounting to at least one solvency margin. One-third of the solvency margin shall be deemed to be the guarantee fund.

    2) The Government shall determine the allowable own funds and issue regulations on the amount and the calculation:

  • a) of the solvency margin on the basis of the total business;

    b) of the guarantee fund which corresponds to a certain fraction of the solvency margin and may not be less than the minimum guarantee fund;

    c) of the minimum guarantee fund on the basis of the capital requirement of the particular insurance branch.




  • Art. 16

    Actuarial Reserves

    1) Insurance undertakings are obliged to form sufficient actuarial reserves for the entire business activities.

    2) The Government shall issue regulations concerning the types and scope of the provisions and the capital investments relating to such.



    Art. 17

    Organisation Fund

    1) In addition to the minimum capital, an insurance undertaking must have at its disposal an organisation fund for the formation and setting-up costs or for an exceptional expansion of business.

    2) The Government shall issue supplementary provisions concerning the amount, creation, maintenance period and restoration of the organisation fund.

    3) The Supervisory Authority shall fix the amount of the organisation fund in the individual case; in exceptional cases, exemption may be granted from the obligation to set up the organisation fund.


    © 2001 Kurt

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