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Insurance Undertakings A. Routine Supervision in General Art. 35 Principle 1) The Supervisory Authority shall supervise the total business activities of the insurance undertakings. 2) It shall monitor the observance of the laws, the maintenance of the solvency of the insurance undertakings, the formation of the necessary reserves and the adequate protection of the interests of policy holders.
Observance of the Business Plan 1) The Supervisory Authority shall monitor the observance of the authorised business plan. 2) If parts of the business plan are amended, such amendments may not be introduced by the insurance undertaking until they have been approved by the Supervisory Authority. 3) The Supervisory Authority may demand that the business plan be modified before new insurance contracts are concluded. Should it appear necessary for the protection of policy holders, the Supervisory Authority may change or cancel a business plan, with effect for existing or not yet implemented insurance relationship.
Monitoring of Own Resources 1) If of an insurance undertakingís own resources are less than the solvency margin, the undertaking must, upon request, submit to the Supervisory Authority for approval a plan for the restoration of sound financial conditions (solvency plan). 2) If the own resources of an insurance undertaking are less than the guarantee fund or are not creditable to the necessary extent, the undertaking must, upon request, submit to the Supervisory Authority for approval a plan for the short-term procurement of the necessary own funds (funding plan). 3) If a further deterioration in the financial situation threatens, the Supervisory Authority may, notwithstanding its other powers, restrict or prohibit the free disposal of the assets of the undertaking. The same shall apply accordingly if an insurance undertaking does not form sufficient actuarial reserves or does not sufficiently cover its reserves or fails in any other way to comply with the legal and official regulations relating to the provision and investment of capital.
Supervision of Holdings If an insurance undertaking with domicile in the Principality of Liechtenstein has a holding in another undertaking which is not subject to insurance supervision and if the holding by its nature or extent is likely to endanger the insurance undertaking, the Supervisory Authority may forbid the insurance undertaking to continue the holding or may bind this to certain conditions. Balance Sheet and Reporting 1) Insurance undertakings domiciled in the Principality of Liechtenstein must prepare their balance sheet annually, by the 31 December. In addition, they must submit a report on the concluded business year together with the balance sheet to the Supervisory Authority by 30 April every year. The balance sheet and the report must conform with the regulations and directives issued by the Government and the Supervisory Authority. 2) For non-EEA undertakings, Para. 1 shall apply analogously insofar as such undertakings are required to submit a report as specified in Art. 32 Para. 1 Sub-Para. c. 3) In the case of insurance undertakings conducting reinsurance business only, the period specified in Para. 1 for the submission of the balance sheet and the business report shall be extended to 31 October if the business year coincides with the calendar year. 4) Insurance undertakings must publish the balance sheet and the business report.
External Audit Requirement 1) Insurance undertakings must have their business activities audited every year by an auditor who is independent of them and recognised by the Government. The insurance undertakings are required to provide the auditor with all the information necessary for an appropriate audit. 2) For the auditor, the insurance undertakings must, in particular: b) permit inspection of their books, accounting records, business correspondence and minutes of the board of directors and of the company management; c) they must submit the reports of the internal audit. 3) In the case of non-EEA undertakings which have an agency or a branch office in the Principality of Liechtenstein at their disposal, the audit carried out at the domicile of the head office shall be recognised provided it satisfies the requirements contained in this law and the domestic agency or branch office is also included in the audit. Art. 41 Para. 2 is reserved. 4) The Government shall determine by Executive Order the more detailed provisions concerning the recognition of auditors. |
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