(Re)insurance undertakings, including captives, are regulated by the Insurance Business Act, regulations issued there-under as well as Insurance Rules made by the MFSA.
The MFSA is mainly responsible for:
- The prudential supervision of Maltese (re)insurance undertakings with respect to their total business written in Malta and/or outside Malta, including in EU/EEA Member States, through a branch (FOE) and/or under freedom of services (FOS), as well as Maltese branches of non-EU/EEA (re)insurers;
- Ensuring that (re)insurance undertakings authorised under the Insurance Business Act comply with the provisions of the insurance legislation and with the conditions of authorisation;
- Where the MFSA is responsible for group supervision as determined in accordance with Article 247 of the Solvency II Directive, it is responsible for the co-ordination and the exercise of group supervision;
- Exercising its powers of intervention in the circumstances and as set out in the Insurance Business Act.
Supervision is based on a prospective and risk based approach and is carried out in a proportionate manner and comprises an appropriate combination of off-site and on-site supervision. Duties are carried out in a transparent and accountable manner taking into account the protection of confidential information. In exercising its functions and duties under the the Insurance Business Act, MFSA is required by Law to take into account a European Union dimension and to duly consider the potential impact of its decisions on the stability of the financial system in the European Union, in particular, in emergency situations.
When carrying out its duties the MFSA is required by law, in particular, to have regard to:
- The protection of insured persons, policy-holders, beneficiaries and the general public;
- Protection of the reputation of Malta, taking into account Malta’s international commitments;
- The promotion of competition and choice.
Regulation 6(1) of the Insurance Business (General Provisions of Supervision) Regulations, 2015, requires the MFSA to carry on its duties in a transparent and accountable manner taking into account the protection of confidential information. This requirement emanates from Article 31 of Directive 2009/138/EC (“the Solvency II Directive”)…