Regulatory part

Insurance and reinsurance undertakings applying the equalisation adjustment referred to in Article R. 351-4, the volatility adjustment referred to in Article R. 351-6 or the transitional measures referred to in Articles L. 351-4 and L. 351-5 shall assess their compliance with the capital requirements referred to in Article R. 354-3, both taking into account and without taking into account such adjustments, corrections and transitional measures.

Where an internal model is used, the internal risk and solvency assessment reconciles the internal risk measures with the required solvency capital.

Internal risk and solvency assessment is an integral part of the business strategy of insurance and reinsurance companies. These undertakings systematically take it into account in their strategic decisions. The undertakings shall carry out this internal assessment at least once a year and in the event of any significant change in their risk profile. They shall inform the Autorité de contrôle prudentiel et de résolution of the conclusions of each…

The internal control system referred to in Article L. 354-2 includes at least administrative and accounting procedures, an internal control framework, appropriate information arrangements at all levels of the company and a compliance function referred to in Article L. 354-1.

The purpose of the compliance function referred to in Article L. 354-1 is, in particular, to advise the Chief Executive Officer or the Management Board, as well as the Board of Directors or the Supervisory Board, on all matters relating to compliance with the laws, regulations and administrative provisions governing the taking up and pursuit of the business of insurance and reinsurance. This function also aims to assess the possible…

The internal audit function referred to in Article L. 354-1 assesses in particular the adequacy and effectiveness of the internal control system and the other elements of the system of governance. This function is performed objectively and independently of the operational functions. The conclusions and recommendations of the internal audit, together with the proposals for action arising from each of them, are communicated to the Board of Directors or the…

The purpose of the actuarial function referred to in article L. 354-1 is to coordinate the calculation of prudential technical provisions, to guarantee the appropriateness of the methodologies, underlying models and assumptions used to calculate prudential technical provisions, to assess the adequacy and quality of the data used to calculate these provisions, to supervise this calculation in the cases referred to in article R. 351-13 and to compare the best…

The actuarial function requires the persons performing it to have a degree of knowledge of actuarial and financial mathematics commensurate with the nature, scale and complexity of the risks inherent in the business of insurance or reinsurance undertakings, and to be able to demonstrate relevant experience with regard to professional standards and other applicable standards.

I.-The key functions mentioned in Article L. 354-1 and those whose interruption, once outsourced, is likely to have a significant impact on the business of the company, on its ability to manage risks effectively or to call into question the conditions of its authorisation, are considered to be important or critical operational activities or functions within the meaning of Article L. 354-3, in the light of the following factors: a)…

For insurance and reinsurance undertakings which enter into limited financial reinsurance contracts or which conduct limited financial reinsurance activities referred to in Article L. 310-1-1 and Articles L. 111-1-1 of the Code de la mutualité and L. 931-1-1 of the Code de la sécurité sociale, the risk management system which they put in place, in accordance with Article L. 354-2, must enable the risks arising from these contracts or activities…