Legal basis for the recovery and resolution of insurance companies

The insurance sector fulfils important tasks in risk distribution and thus makes a decisive contribution to the functioning of the real economy and financial markets. An uncoordinated failure – particularly of large institutions – would also have an impact on the financial system and the real economy. Accordingly, initiatives have recently been launched at international and national level to further improve the resilience and crisis planning of these institutions and the relevant insolvency authorities.

The provisions of the Insurance Supervision Act (ISA) on protective measures (Art. 51), measures in the event of insolvency risk and liquidation (Art. 51 ff. ISA) as well as the procedural provisions (Art. 54d ff. ISA) define FINMA’s powers as the competent insolvency authority for insurance companies.  

Article 22a ISA in conjunction with the implementing provisions of the ISO (98b ff.) defines the powers and conditions under which FINMA must require economically significant insurance firms to produce a recovery plan.