On the 31st October 2019, the European Insurance and Occupational Pensions Authority (EIOPA) issued the responses provided by the competent authorities of each individual member state in relation to the 'Recommendations for the insurance sector in light of the United Kingdom withdrawing from the European Union' which EIOPA had published on the 19th February 2019 ("the EIOPA Recommendations").
In its response to EIOPA Recommendations, the Maltese financial services regulator, the Malta Financial Services Authority (MFSA), has indicated that it complies or will comply with the recommendations included in the EIOPA Recommendations.
In particular, in its response, MFSA indicated that a communication has been issued to all affected UK undertakings, UK intermediaries and Gibraltar-based insurance undertakings and intermediaries, wherein the MFSA's expectations in the event of the UK's withdrawal from the EU were explained.In order to facilitate the orderly run-off of business which becomes unauthorised in the event of the UK's withdrawal from the EU, the MFSA, in the said communication, sets out the following:
MFSA expects UK and Gibraltar-based insurance undertakings deciding to carry out an orderly run-off of the business which will become unauthorised to follow a set procedure.
According to this communication, the UK and Gibraltar-based insurance undertakings were required to notify the MFSA by the 13th September 2019 that they intend to carry out an orderly run-off. The communication also contained information which such undertakings are required to provide to the MFSA, including:
i. The date as from when such undertaking will be carrying out the run-off; ii. The classes of business of insurance and the details of the nature of the risks or commitments; iii. The volume of gross and net technical provisions; iv. An indication of the remaining term run-off or servicing of the business; v. Confirmation as to whether the UK or Gibraltar-based insurer will be carrying out the run-off or servicing of the business or whether it will be appointing an entity to do so.In case of the latter, such undertaking is expected to: Provide the MFSA with the name and details of the entity that will be appointed to carry out the run-off or servicing of the business; and Enter into a run-off or servicing agreement with the entity appointed to carry out such run-off or servicing. 2. The expectation that UK and Gibraltar-based insurance undertakings...