The CAA ?

The Commissariat aux Assurances (CAA), a public institution under the authority of the Minister of Finance, is the official regulatory and supervisory authority for the insurance and reinsurance sector in the Grand Duchy of Luxembourg. It has a legal personality distinct from that of the State, and enjoys financial autonomy¹. Its mandate covers :

• Insurance companies (Luxembourg insurers and foreign branches),

• Reinsurance companies,

• Luxembourg pension funds,

• Insurance professionals²,

• Insurance and reinsurance intermediaries (agents and (sub-)brokers)

• Insurance intermediaries on an ancillary basis³.

The CAA aims to protect the stability and integrity of the Luxembourg financial sector, as well as that of operators and consumers.

History of the CAA

In 1996, the CAA replaced the Office des Assurances, five years after it was established by the Insurance Industry Act of December 6, 1991, which called for increased regulation and supervision of the sector⁴. From then on, from 1996 to the present day, the CAA has been reformed on numerous occasions to adapt the regulatory framework to market developments and European requirements. One of the most recent of these was the adoption of the Solvency II Directive, a regulatory reform of the insurance industry voted by the European Parliament and Council in 2009, and transposed into Luxembourg law in 2015⁵. This directive strengthened the regulatory framework for the insurance sector, and increased transparency, accountability and risk management for companies by harmonising the solvency rules applying to insurance companies. The CAA has also been proactive in promoting sustainable finance, encouraging companies to integrate ESG criteria and the European Union’s sustainable development objectives into their strategies.

Internal organisation

The CAA Board consists of a chairman and two members – at most – appointed by the Grand Duke on the recommendation of the Government Council, and selected among the Commissariat’s civil servants. The Board is responsible for all matters not specifically reserved by law to the Minister or the Council⁶.

The Comité consultatif de la réglementation prudentielle⁷ (Prudential Regulation Advisory Committee), made up of 8 members including the Minister (or a representative), plays a major role in the development and implementation of all new regulations in the insurance sector. The Government may ask for its opinion on any draft national regulation concerning the insurance sector and falling within the mandate of the CAA. Its opinion must also be sought before any draft CAA regulations are approved.

Click here to know more about the CAA organisation chart.

Mission

The main objectives of the CAA are: to supervise (re)insurances, to protect both policyholders and beneficiaries, as well as members and beneficiaries of pension funds subject to its supervision⁸.

To this end, the CAA’s supervisory mission involves :

• The registration of individuals and legal entities wishing to carry out activities falling under the supervision of the CAA

• Prudential supervision of these same individuals and companies, and oversight of the insurance products market: the CAA monitors companies’ solvency and, through compliance checks, their respect of applicable regulations and governance requirements.

• Proactive monitoring of compliance with professional obligations to combat financial crime, i.e. money laundering, the financing of terrorism and the proliferation of weapons of mass destruction⁹. In the event of non-compliance, the CAA has the power to impose sanctions. See also details about international financial sanctions on the Ministry of Finance website.

• Participation in international and European workshops to draft common standards.

• Drafting legislation and prudential regulations relating to the insurance sector.

• The out-of-court settlement of disputes and the examination of claims relating to supervised activities.

The CAA also plays an important role in (financial) crisis management, notably in collaboration with other national and international authorities, as part of its primary mission to protect the rights and interests of consumers, and thus the stability and development of the system itself.

Finally, the CAA carries out a wide range of regulatory research and information activities, particularly intending to promote sustainable finance.

Supervision tools

CAA supervision is carried out by :

• Analyses of a company’s strategy, players and resources before issuing its approval.

• Once approval has been obtained, and during the course of the insurance market player’s activity, the CAA regularly commissions reports on their activities and solvency margins.

• The CAA also carries out compliance checks, either remotely or on-site (verifying commercial practices and compliance with transparency obligations, assessing risks to financial stability, combating financial crime, etc.). It is entitled to obtain any document or information that is useful or necessary for the performance of its duties.

• In the event of failure to comply with the regulations in force, the CAA can impose sanctions, or even withdraw an entity’s authorisation in the most serious cases¹⁰.

• Once operations have ceased, the CAA oversees the liquidation process to ensure that policyholders’ interests are safeguarded.

• Studies (e.g. on life insurance companies’ commitment to sustainability)

Cooperation between regulatory authorities

The CAA collaborates with other regulators and international organisations to harmonise regulatory practices, which is essential for the supervision of multinational companies. In particular, it cooperates with the FATF (the world body for the monitoring and prevention of money laundering and terrorist financing¹¹), and with other Luxembourgish financial sector supervisory authorities, such as the Commission de Surveillance du Secteur Financier (CSSF) and the Cellule de Renseignement Financier (CRF). It is a member of the European Insurance and Occupational Pensions Authority (EIOPA) and the International Association of Insurance Supervisory Authorities (IAIS)¹².

Contacts

Website

Contact

Tel.: (+352) 22 69 11 – 1  

Fax: (+352) 22 69 10 

Mailing address

11, rue Robert Stumper, 
L-2557 Luxembourg 
GD de Luxembourg   

1. The CAA (in French) ↩︎
2. Insurance professionals (in French) ↩︎
3. Information about mandates on: https://www.caa.lu/fr/operateurs and https://www.caa.lu/fr/le-caa ↩︎
4. December 6, 1991 law ↩︎
5. Solvency II ↩︎
6. The CAA (in French) ↩︎
7. Comité consultatif de la réglementaton prudentielle ↩︎
8. The CAA (in French) ↩︎
9. Lutte contre le blanchiment et le financement du terrorisme ↩︎
10. The CAA (in French) ↩︎
11. FATF ↩︎
12. The CAA (in French) ↩︎