Version status: Amended | Document consolidation status: Updated to reflect all known changes
Version date: 23 May 2014 - onwards
  Version 3 of 3    

Article 37 Capital add-on

1. Following the supervisory review process supervisory authorities may in exceptional circumstances set a capital add-on for an insurance or reinsurance undertaking by a decision stating the reasons. That possibility shall exist only in the following cases:

(a) the supervisory authority concludes that the risk profile of the insurance or reinsurance undertaking deviates significantly from the assumptions underlying the Solvency Capital Requirement, as calculated using the standard formula in accordance with Chapter VI, Section 4, Subsection 2 and:

(i) the requirement to use an internal model under Article 119 is inappropriate or has been ineffective; or

(ii) while a partial or full internal model is being developed in accordance with Article 119;

(b) the supervisory authority concludes that the risk profile of the insurance or reinsurance undertaking deviates significantly from the assumptions underlying the Solvency Capital Requirement, as calculated using an internal model or partia