Objectives of supervision, main functions and activities

This web page presents the objectives of supervision as well as their main functions and activities pursuant to Art. 31 (2) lit. e of the Solvency II Directive (Directive 2009/138/EC). The following sections clarified the statutory supervisory mandate as well as the material areas of activity and focus of insurance supervision.

Objectives of supervision

The main purpose of insurance supervision is the protection of insurance policyholders and beneficiaries. Irrespective of this aim, the Austrian Financial Market Authority (FMA) shall duly consider in the performance of its tasks the potential impact of its decisions on the stability of the financial system in all EEA Member States concerned and, in particular, in emergency situations, based on the information available at the relevant time. In times of exceptional movement in the financial markets the FMA shall take the potential procyclical effects of the measures that it deploys into account.

Main functions of supervision

The FMA shall monitor all business conduct of insurance and reinsurance undertakings in the scope set out for the licence pursuant to Article 6 para. 1 of the Insurance Supervision Act 2016 (VAG 2016; Versicherungsaufsichtgesetz 2016). The FMA’s supervisory activities must be both risk-based and forward looking. The focus of supervisory activity is on the the orderly functioning of insurance and reinsurance business as well as the compliance with the applicable regulations for the operation of contractual insurance business, in particular the VAG 2016, Delegated Regulation (EU) 2015/35 and the EU technical standards, by insurance and reinsurance undertakings. In so doing the FMA ensures that there is an appropriate combination of location-independent activities and on-site inspections. In exercising its powers, the FMA takes into account the nature, scope and complexity of the risks that arise from the business activity of the insurance and reinsurance undertakings.

Main areas for ongoing or planned supervisory activity

Insurance supervision includes the performance of the official tasks and powers that are defined and assigned to the Financial Market Authority in the Insurance Supervision Act 2016 (VAG 2016; Versicherungsaufsichtsgesetz 2016), in the Motor Vehicle Liability Insurance Act 1994 (KHVG 1994; Kraftfahrzeug-Haftpflichtversicherungsgesetz), in the Act on Compensation of Road Accident Victims (VOEG; Verkehrsopfer-Entschädigungsgesetz), in the Federal Law on the Liability under Civil Law for Damage caused by Radioactivity (AtomHG 1999; Atomhaftungsgesetz 1999), in the Financial Conglomerates Act (FKG; Finanzkonglomerategesetz) in the (SFT Enforcement Act (SFT-Vollzugsgesetz) and in the Financial Markets Anti-Money Laundering Act (FM-GwG; Finanzmarkt-Geldwäschegesetz). Details about supervisory activities may be found in the FMA Annual Reports as well as the priorities for supervision and inspections.