Minimum capital requirement

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The Minimum Capital Requirement (Engl. Minimum Capital Requirement , abbr. MCR ) is one of the legal requirements for the presence of own funds in insurance companies and pension funds , which applies in Germany since 1 January 2016.

In addition to the minimum capital requirement, there is also the (higher) solvency capital requirement (SCR), which together form a tiered system. The minimum capital requirement represents the lower threshold below which an unacceptable level of risk for policyholders (and other beneficiaries) is assumed.

If the solvency capital requirement is no longer met, restructuring measures are taken by the company and, if necessary, measures by the insurance regulator. If the minimum capital requirement is also breached, more drastic and short-term measures are planned. If the company cannot meet the minimum capital requirement again within three months, the business operating license can be withdrawn.

The calculation of the minimum capital requirement depends on the solvency regime - for insurers and pension funds under Solvency I this is one third of the solvency capital requirement , for insurers under Solvency II the calculation is more complex.

The minimum capital requirement goes back to the changes in the insurance supervisory capital requirements through the European Solvency II project. This was legally standardized through the EU Directive 2009/138 / EC, which was implemented in this regard in Germany through Section 122 of the VAG.

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