On January 8, IVASS published a clarification concerning the application of article 46 of IVASS Regulation no. 40/2018.

As it is known, article 46 of the said Regulation requests insurers to draft a yearly report on the distribution network, which must be validated by the compliance function and must be submitted to IVASS, once having been approved by the administrative body, which must indicate:

  1. the activity of monitoring carried out in order to verify the correct implementation of the policies and of the procedures adopted and the relevant outcomes;
  2. the possible criticalities observed and the relevant measures adopted or to be adopted;
  3. the solutions proposed to modify the policies and the procedures.

The clarification submitted was aimed at clarifying whether, pending the Consultation Document no. 2/2019 which modifies, among others, Regulation 40, insurance companies, including EU ones operating in Italy under the ROE or the FOS regime, must apply the discipline contained in article 46 of the said Regulation or rather the one contained in IVASS Regulation no. 5/2006, now abrogated.

In its clarification, IVASS explains that, pending the amendments to IVASS Regulation no. 40/2018 by virtue of the Consultation Document no. 2/2019, article 46 of the mentioned Regulation is directly applicable to insurance companies.

As a consequence of the above, for year 2019, insurance companies must request the compliance function to validate the report on the distribution network as required by art. 46 of Regulation no. 40, without prejudice to the possibility - in exceptional cases - to request such validation to the internal audit function, providing an adequate motivation.