Insurance special purpose vehicle
Insurance special-purpose vehicles are companies that assume actuarial risks from insurance companies but are not insurance companies themselves. The risk assumed is hedged by issuing subordinated debt such as catastrophe bonds . In this way, insurance companies can transfer risks to the capital market (see also securitization ) and thus increase their underwriting capacity.
Insurance special purpose vehicles are a special form of self -insurers (English captives ). While self-insurers can in principle also directly cover risks from non-insurance companies, special-purpose insurance companies only assume risks from primary insurers and reinsurance companies.
The Directive 2005/68 / EC (Reinsurance Directive) contains in Art. 46 the option for the member states to allow insurance special purpose vehicles. In Germany, this type of risk transfer has been regulated in the Insurance Supervision Act since 2007 . Insurance special purpose vehicles are subject to financial supervision , but the requirements are significantly simplified in contrast to primary insurance and reinsurance companies.
