Draft regulations on investments and assets covering technical provisions (Consultation Document 26/2015) were published on the website of IVASS (the Italian insurance regulator) on December 16 2015.
The draft regulations aim to implement the new provisions introduced in this regard under Articles 37terand 38 of the Insurance Code following Decree-Law 74/2015's transposition of the EU Solvency II Directive (2009/138/EC) and the European Insurance and Occupational Pensions Authority guidelines in this field.(1)
Observations and proposals on the draft regulations may be sent to IVASS by no later than February 15 2016.
The main changes that the draft regulations introduce with respect to the existing provisions include:
- the introduction of the prudent person principle when selecting investments and assets covering technical provisions;
- the elimination of the quantitative and eligibility restrictions relevant to assets covering technical provisions (with the exception of the restrictions specifically provided for the lending activity, given the complexity and risk involved); and
- the strengthening of internal control systems.
The framework resolution on investments (adopted by management and reviewed at least once a year) will define:
- investment strategies;
- the principles for management of assets and liabilities; and
- liquidity risk management policy.
Senior management is responsible for implementing, maintaining and monitoring investment management policies, while the supervisory body is responsible (among other things) for substantiating the compatibility and consistency of these policies with respect to the company's risk profile and financial position.
For further information on this topic please contact David Maria Marino at DLA Piper Italy by telephone (+39 02 80 61 81) or email (firstname.lastname@example.org). The DLA Piper website can be accessed at www.dlapiper.com.
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