RegAlert2022-10-17 | NBB_2022_24Added · Updated
Circular on Guidelines Regarding Contract Boundaries
This circular provides guidelines for Belgian insurance and reinsurance undertakings on defining contract boundaries under Solvency II, effective January 1, 2023. It establishes that contract boundaries represent a limit between premiums/obligations included in the contract and those excluded, requiring consistent application of principles regarding unilateral rights, premium risk reflection, and contract decomposition. The document details specific criteria for assessing the perceptible economic effect of financial guarantees and coverage, mandating reevaluation only under extreme economic changes or significant contract term modifications. It also requires immediate reporting to the regulator if such reevaluations significantly impact technical provisions or solvency.
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boulevard de Berlalmont 14 - BE-1000 Bruxelles tel. +32 2 221 27 31 numero d'entreprlse: 0203.201.340 RPM Bruxelles www.bnb.be n '»uiH!i!('Nationalei5(inl DE BELCIQUE VAN BELCIE rurosyso'm Circular Brussels, 17 October 2022 Reference:
your correspondent:
Stany Zabinski tel. +32 2 221 34 67 stany.zabinski@nbb.be NBB_2022_24 Circular on Guidelines Regarding Contract Boundaries Scope Belgian insurance or reinsurance undertakings; Insurance or reinsurance undertakings that are part of a Belgian group within the meaning of
Article 339, 2° of the Law of 13 March 2016 on the status and supervision of insurance or reinsurance undertakings,
Belgian undertakings that are part of a Belgian financial conglomerate within the meaning of
Article 340, 1° of the aforementioned Law of 13 March 2016,
Branches of third-country undertakings carrying on insurance [or reinsurance] activities in Belgium This circular applies to mutual insurance societies defined in Article 15, 79° of the aforementioned Law of 13 March 2016. For these undertakings, "the Bank" should be replaced by "the Office for the Supervision of Mutualities and National Unions of Mutualities" as defined in Article 15, 84° of the same Law. This circular does not apply to insurance undertakings referred to in Articles 275, 276 or 294 of the aforementioned Law of 13 March 2016. Objective This circular aims to explain the Bank's guidelines on contract boundaries. Legal References The Law: The Law of 13 March 2016 on the status and supervision of insurance or reinsurance undertakings Regulation 2015/35: Delegated Regulation (EU) 2015/35 of the Commission of 10 October 2014 supplementing Directive 2009/138/EC of the European Parliament and of the Council on the access to and the exercise of the activities of insurance and reinsurance NBB_2022_24 - 17 October 2022 Circular - P. 1/8
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Lineage: In force
Source: National Bank of Belgium — original document · Summary generated with machine assistance and reviewed before publication; the authoritative text is the regulator's original document. How RegAlert works
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