IMF Staff Country Reports

Luxembourg: Financial Sector Assessment Program—Technical Note on Insurance Regulation and Supervision

June 24, 2024

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International Monetary Fund. Monetary and Capital Markets Department "Luxembourg: Financial Sector Assessment Program—Technical Note on Insurance Regulation and Supervision", IMF Staff Country Reports 2024, 184 (2024), accessed November 23, 2024, https://doi.org/10.5089/9798400278846.002

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Summary

This technical note analyzes the key aspects of the regulatory and supervisory regime for insurance companies in Luxembourg. The analysis is part of the 2024 Financial Sector Assessment Program (FSAP) and based on the regulatory framework in place and the supervisory practices employed as of October 2023. The FSAP reviewed recent developments and the structure of the Luxembourgish insurance sector. The sector is large, well developed, and highly interconnected with other insurance markets through internationally active insurance groups and cross-border business. After having grown substantially in size, it is recommended to further strengthen the Commissariat aux Assurances’s (CAA) independence and its internal governance. The CAA’s staff has roughly doubled since the last FSAP but should be constantly reviewed with further expanding tasks. The authority’s independence could be further strengthened by safeguarding the independence of its Board members and narrowing down in the Insurance Act the reasons on which the CAA’s Directorate could be dismissed. The governance of the CAA would benefit from setting up an internal audit function, and strengthening IT governance as projects are currently conducted largely in-house.

Subject: Anti-money laundering and combating the financing of terrorism (AML/CFT), Crime, Financial institutions, Financial Sector Assessment Program, Financial sector policy and analysis, Insurance, Insurance companies, Solvency

Keywords: D.c, Anti-money laundering and combating the financing of terrorism (AML/CFT), Financial Sector Assessment Program, G. Macroprudential supervision, Global, Insurance, Insurance companies, International Monetary Fund Washington, Solvency, Solvency ASSESSMENT, Solvency capital requirement, Solvency coverage

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