Regulatory Alerts2006-12-12
FMA Circular on Differentiation of Profit Participation in Pension Insurance and Unit-Linked Life Assurance
The Austrian Financial Market Authority (FMA) issued this circular to prohibit the unequal treatment of insured persons within pension insurance portfolios by restricting differentiated profit participation. The regulator mandates that total interest payments must generally remain uniform across comparable contracts, allowing variations only for specific material justifications such as differing biometric bases. Additionally, the FMA requires that unit-linked and index-linked life assurance policies maintain significant technical risk throughout their term, including a minimum risk capital of 5% for death benefits.
Share