Prudential requirements bearing on the persons who effectively run the undertaking or hold a key function, assessed at appointment and then on an ongoing basis by the supervisor.
Capital decides nothing; people decide. Solvency II draws the consequence by subjecting anyone who effectively runs the undertaking or holds a key function to a double test. Competence is assessed collectively as much as individually: the administrative body must jointly cover markets, strategy, business model, governance system, financial and actuarial analysis, and the regulatory framework, which rules out a board of identical profiles however excellent. Propriety is assessed individually, on absence of conviction, integrity and financial soundness. Two features make this more than a formality. Assessment is ongoing rather than one-off: a director fit at appointment ceases to be so if circumstances change, and the undertaking must notify it. And the supervisor holds a power of objection that can reach suspension or removal, which gives prior notification its real weight. The distribution directive extends a comparable, lighter requirement to the people who sell.
Article 42 of Directive 2009/138/EC. In France, every appointment of an effective director or key function holder is notified to the ACPR with an individual file, and the authority has a window in which to object. Collective competence is where inspections most often find fault: a board of seven finance professionals, with no actuarial or technology competence at all, fails the collective test even if each member passes the individual one.
fit and proper, dirigeant effectif, notification de nomination, exigences d'aptitude et d'honorabilité