14th Apr 2016
The Cyprus Parliament has approved a new law and regulations on Insurance Services (“The Insurance and Reinsurance Services and Other Related Issues Law of 2016” and “The Insurance and Reinsurance Services and Other Related Issues Regulations of 2016”). The new legislation repeals and replaces the existing legislation of 2002, in line with the EU Directive 2009/138 (“Solvency II” Directive”) as amended by Directive 2014/51/EU (“Omnibus II”) on the taking-up and pursuit of the business of insurance and reinsurance.
The aim of the new legislation, that reflects the structure of the said directive, is to introduce a sound and robust prudential framework for insurance firms in Cyprus, including quantitative, governance and reporting rules, thus ensuring the financial soundness of insurance companies so that they can cover risks in difficult periods.
It is noted that the EU Solvency II framework transposed in Cyprus law, is divided into the following three pillars: