Swiss Financial Market Supervisory Authority FINMA

Annual Report 2013

Swiss solvency regime

The Swiss solvency regime, taking life insurers as an example

The Swiss Solvency Test (SST) has been in force since 2011. It has proved to be a good ‘thermometer’ that allows companies to form a realistic picture of their economic situation. The SST provides FINMA with an overview of the entire market and the risk situation.


SST and Solvency I
Measuring solvency: reaction of both systems to the low interest environment

The chart shows that the SST reacts to basic changes such as low interest rates in contrast to the old system of measuring solvency (Solvency I), which is not responsive to economic changes and gives a false sense of security. The SST has raised FINMA’s awareness of risks in good time. This has allowed FINMA to ensure that insurance companies strengthen their equity capital, which subsequently helps to protect policyholders.


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