Regulatory Alerts2005-11-10
FMA Circular 07/2005 on Overfunding in Unit-Linked Life Assurance
The Financial Market Authority (FMA) establishes conditions for accepting temporary overfunding of technical provisions in the unit-linked life assurance Deckungsstock group under the Insurance Supervision Act. Insurers must ensure the excess arises from necessary advance purchases or accounting settlements, remains business-related and non-permanent, stays within a 5 percent threshold (or €400,000 for smaller provisions), and utilizes funds registered for public distribution in Austria. These guidelines apply exclusively to unit-linked products and clarify that foreign investment funds must meet Austrian public distribution registration requirements to satisfy cover obligations.
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