Order on Reports on Solvency and Financial Situation for Group 1 Insurance Undertakings

Order on Reports on Solvency and Financial Situation for Group 1 Insurance Undertakings etc.1)

Pursuant to Section 164, paragraph 3, and Section 316, paragraph 1, of Act No. 718 of 13 June 2023 on Insurance Undertakings, it is hereby prescribed:

Scope of Application

Section 1. This Order applies to Group 1 insurance undertakings and groups or undertakings covered by Section 166, paragraphs 1 and 2, of the Act on Insurance Undertakings.

Paragraph 2. The annual reporting, pursuant to Section 164, paragraphs 1 and 2, of the Act on Insurance Undertakings, shall, in addition to the rules in Commission Delegated Regulation (EU) 2015/35 of 10 October 2014 supplementing Directive 2009/138/EC of the European Parliament and of the Council on the taking-up and pursuit of the business of Insurance and Reinsurance (Solvency II), be carried out in accordance with the provisions of this Order.

Structure and Content of the Public Report

Section 2. In addition to the rules in Articles 290-303 of Commission Delegated Regulation (EU) 2015/35 of 10 October 2014 supplementing Directive 2009/138/EC of the European Parliament and of the Council on the taking-up and pursuit of the business of Insurance and Reinsurance (Solvency II), Sections 3-6 apply to the report on solvency and financial situation that Group 1 insurance undertakings must publish.

Section 3. The information in the report may be included in full or in the form of references to information of a similar nature and scope that has been published in accordance with other laws or administrative regulations.

Section 4. A Group 1 insurance undertaking may voluntarily publish additional information beyond what is required, subject to Article 298 of Commission Delegated Regulation (EU) 2015/35 of 10 October 2014 supplementing Directive 2009/138/EC of the European Parliament and of the Council on the taking-up and pursuit of the business of Insurance and Reinsurance (Solvency II).

Exceptions to the Requirement to Publish Information

Section 5. The Danish Financial Supervisory Authority may approve that a Group 1 insurance undertaking refrains from publishing information, subject to Article 299 of Commission Delegated Regulation (EU) 2015/35 of 10 October 2014 supplementing Directive 2009/138/EC of the European Parliament and of the Council on the taking-up and pursuit of the business of Insurance and Reinsurance (Solvency II).

Paragraph 2. Approval is granted in the following cases:

1. If the undertaking's competitors would gain a significant and unfair advantage if the information were published.
2. If the undertaking is bound by confidentiality obligations due to commitments to policyholders or counterparties.

Paragraph 3. The undertaking must state in the report which information is not published and the reasons therefor.

Paragraph 4. The undertaking cannot obtain approval to refrain from publishing information on the undertaking's capital management as described in Article 297 of Commission Delegated Regulation (EU) 2015/35 of 10 October 2014 supplementing Directive 2009/138/EC of the European Parliament and of the Council on the taking-up and pursuit of the business of Insurance and Reinsurance (Solvency II).

Information on Significant Events

Section 6. A Group 1 insurance undertaking must publish information on the nature and effects of significant events that have a material impact on the published information.

Paragraph 2. The following are considered minimum to constitute a significant event:

1. When a significant failure to meet the Solvency Capital Requirement is identified, and the Danish Financial Supervisory Authority has not, within a period of two months after the date on which the deviation was identified, received a recovery plan, pursuant to Section 223, paragraph 1, of the Act on Insurance Undertakings.

2. The Order contains provisions implementing parts of Directive 2009/138/EC of the European Parliament and of the Council of 25 November 2009 on the taking-up and pursuit of the business of Insurance and Reinsurance (Solvency II), OJ 2009, No. L 335, p. 1, and Directive 2014/51/EU of the European Parliament and of the Council of 16 April 2014 amending Directives 2003/71/EC and 2009/138/EC and Regulations (EC) No 1060/2009, (EU) No 1094/2010 and (EU) No 1095/2010 as regards the powers conferred on the European Supervisory Authority (European Insurance and Occupational Pensions Authority) and the European Supervisory Authority (European Securities and Markets Authority), OJ 2014, No. L 153, p. 1.

3. When a failure to meet the Minimum Capital Requirement is identified, and the Danish Financial Supervisory Authority either assesses that the undertaking will not be able to present a financing plan, or the Danish Financial Supervisory Authority does not receive such a plan within a period of one month after the date on which the deviation was identified, pursuant to Section 224, paragraph 1, of the Act on Insurance Undertakings.

Paragraph 3. If the significant failure to meet the Solvency Capital Requirement or the failure to meet the Minimum Capital Requirement is not remedied within six months, pursuant to paragraph 2, item 1, or three months, pursuant to paragraph 2, item 2, after its identification, despite the implementation of a recovery plan or a financing plan, the undertaking must publish this upon the expiry of the deadline. The undertaking must simultaneously publish the cause and consequences thereof, as well as information on any corrective measures taken and planned to address the failure to meet the requirement.

Paragraph 4. A Group 1 insurance undertaking must immediately publish information on significant events, subject to Article 363, paragraph 2, and Article 368 of Commission Delegated Regulation (EU) 2015/35 of 10 October 2014 supplementing Directive 2009/138/EC of the European Parliament and of the Council on the taking-up and pursuit of the business of Insurance and Reinsurance (Solvency II). The information must include an indication of the extent of the deviation along with an explanation of the cause and consequences of the deviation and any corrective measures the undertaking may have taken.

Groups and Undertakings

Section 7. In addition to the rules in Articles 359-377 of Commission Delegated Regulation (EU) 2015/35 of 10 October 2014 supplementing Directive 2009/138/EC of the European Parliament and of the Council on the taking-up and pursuit of the business of Insurance and Reinsurance (Solvency II), Sections 3, 4, and Sections 8-10 apply to the report on solvency and financial situation that an undertaking covered by Section 166, paragraph 1 or 2, of the Act on Insurance Undertakings must publish.

Section 8. The Danish Financial Supervisory Authority may approve that an undertaking covered by Section 166, paragraph 1 or 2, of the Act on Insurance Undertakings refrains from publishing information, subject to Article 361 of Commission Delegated Regulation (EU) 2015/35 of 10 October 2014 supplementing Directive 2009/138/EC of the European Parliament and of the Council on the taking-up and pursuit of the business of Insurance and Reinsurance (Solvency II).

Paragraph 2. Approval is granted in the following cases:

1. If the competitors of the group or undertaking would gain a significant and unfair advantage if the information were published.
2. If undertakings in the group or undertaking are bound by confidentiality obligations due to commitments to policyholders or counterparties.

Paragraph 3. Section 4, paragraphs 3 and 4, apply mutatis mutandis to an undertaking covered by Section 166, paragraph 1 or 2, of the Act on Insurance Undertakings.

Section 9. Section 6 regarding the publication of information on the nature and effects of significant events that have a material impact on the published information applies mutatis mutandis to an undertaking covered by Section 166, paragraph 1 or 2, of the Act on Insurance Undertakings.

Section 10. The Danish Financial Supervisory Authority may approve that an undertaking covered by Section 166, paragraph 1 or 2, of the Act on Insurance Undertakings publishes a consolidated report on the group's or undertaking's solvency and financial situation in accordance with Articles 365-371 of Regulation (EU) 2015/35 of 10 October 2014 supplementing Directive 2009/138/EC of the European Parliament and of the Council on the taking-up and pursuit of the business of Insurance and Reinsurance (Solvency II).

Paragraph 2. If a consolidated report for the entire group or undertaking is published, pursuant to paragraph 1, the subsidiaries shall not publish separate reports on their solvency and financial situation.

Paragraph 3. The Danish Financial Supervisory Authority may order a subsidiary to publish information of significant importance if such information is not included in the report pursuant to paragraph 1.

Paragraph 4. In the case where an undertaking covered by Section 166, paragraph 1 or 2, of the Act on Insurance Undertakings publishes a consolidated report pursuant to paragraph 1, Sections 8 and 9 apply mutatis mutandis, subject to Article 367 of Regulation (EU) 2015/35 of 10 October 2014 supplementing Directive 2009/138/EC of the European Parliament and of the Council on the taking-up and pursuit of the business of Insurance and Reinsurance (Solvency II).

Responsibility of the Board

Section 11. Prior to the publication of the report on solvency and financial situation, the board of directors of the Group 1 insurance undertaking or the undertaking covered by Section 166, paragraph 1 or 2, of the Act on Insurance Undertakings, must approve the report.

Penal Provisions

Section 12. Violation of Section 5, paragraph 3, and Sections 6, 9, and 11 is punishable by a fine.

Paragraph 2. Undertakings etc. (legal persons) may be subject to criminal liability pursuant to the rules in Chapter 5 of the Criminal Code.

Entry into Force

Section 13. This Order enters into force on 1 January 2025.

Paragraph 2. Order No. 593 of 31 May 2017 on Reports on Solvency and Financial Situation for Group 1 Insurance Undertakings etc. is repealed.

Ministry of Industry, Business and Financial Affairs, 6 December 2024

Morten Bødskov / Julie Sonne