Directive 2009/138/EC on the taking-up and pursuit of the business of Insurance and Reinsurance (Solvency II)

Overview

Solvency II establishes a risk-based prudential framework for insurance and reinsurance undertakings in the EU. It adopts a three-pillar structure: Pillar I sets quantitative requirements including the Solvency Capital Requirement (SCR) and Minimum Capital Requirement (MCR), Pillar II establishes governance and risk management requirements including the Own Risk and Solvency Assessment (ORSA), and Pillar III imposes disclosure and reporting obligations. Solvency II uses a standard formula or internal models to calculate capital requirements. Directive 2009/138/EC applies from 1 January 2016.

This eu directive (32009L0138) is part of the EU’s legal framework governing insurance. EU insurance regulation harmonizes prudential requirements for insurance and reinsurance undertakings, focusing on risk-based capital requirements and risk management.

Type: EU Directive

CELEX Number: 32009L0138

Date of Effect: See the official publication in the Official Journal of the European Union.

Key Provisions

Directive 2009/138/EC on the taking-up and pursuit of the business of Insurance and Reinsurance (Solvency II) establishes the core legal framework in this field. For specific provisions, articles, and implementing measures, consult the full text on EUR-Lex.

Significance

This legislation represents a key component of EU law in the area of insurance. It reflects the EU’s approach to harmonization and regulatory policy within the internal market framework.