Federal Office of Private Insurance FOPI
Federal Office of Private Insurance FOPI
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FOPI News no. 14
FOPI News no. 14 of 21 December 2007 – New Instruments of Qualitative Insurance Supervision in the Areas of Corporate Governance, Risk Management and Internal Control Systems
The Federal Office of Private Insurance (FOPI) is to utilise two, new self-assessment tools, so as to assess the corporate governance and risk management and the internal control system of insurance undertakings. Both instruments are part of the Swiss Quality Assessment (SQA).
Both of the new instruments are based on a self-analysis of the supervised insurance undertakings. For the first time the insurance undertakings must describe and assess themselves by 31 March 2008, how they fulfilled the requirements under supervisory law in the core areas of corporate governance and risk management/internal control systems.
The self-assessment by the undertakings will be validated by FOPI. This is followed by a risk dialogue with the central exponents from insurance undertakings. If necessary, recommendations will be made or orders issued under supervisory law.
The corresponding legal provisions have been in force since 1 January 2006, the 15/2006 FOPI Directive since 1 January 2007. The directive must be implemented by the end of 2007 at the latest. The goal of the directive is that of defining principle-based requirements so that all insurance undertakings, groups and conglomerates can build up efficient and practical structures and processes in line with business realities.
It will be established to what extent the monitored insurance companies have realised company controls geared to guarantee requirements and checks and balances and established risk management commensurate with the risk profile. At the same time it will be examined to see if an effective internal control system has been established and is being implemented. .
Integrated Insurance Supervision
To assess the qualitative aspects of risk-oriented supervision, FOPI is applying a methodology which is strongly characterised by principle-based requirements. Together with the Swiss Solvency Test (SST), the Swiss Quality Assessment (SQA) forms a central element of new insurance supervision introduced with the Insurance Supervision Act as of 1.1.2006. FOPI is consolidating this modern supervisory instrument with traditional supervisory tools to become a modern, integrated overall concept, which is geared to the challenges of the insurance sector and at the same time strengthens the protection of insured parties.
Inquiries: FOPI Communication, tel. 031 325 01 65
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