Mr Hufeld, you have restructured the Insurance Supervision Directorate. What is changing?

The aim was to create an organisation in which units specialise in different topics and can therefore deal with supervisory issues in the best possible manner by focusing more closely on them and can complement each other to the highest degree possible. There are now three types of section: basic issues sections, which are responsible for overarching topics such as legislation, risk management or analyses, and undertaking-related and competence-related sections. Both of the latter are operational supervision sections – with the difference being that the undertaking-related sections supervise a particular portfolio of undertakings or groups, while the competence-related sections specialise in particular issues that affect many undertakings. Around three-quarters of the staff of Insurance Supervision work in these operational sections.

Why was it necessary to reconsider the structure?

There were three main reasons that led to this decision. Firstly, the regulatory environment has changed significantly as a result of the preparations for the new European supervisory regime, Solvency II. We had to respond to that. Secondly, there are issues that are becoming increasingly important. We must be able to tackle these flexibly. And thirdly, it is always advisable to examine from time to time whether the structures currently in place still ensure the best possible efficiency and quality of work. Competencies should be arranged as optimally as possible.

Let’s just stay with the first point: To what extent is Insurance Supervision now better prepared for II?

Under Solvency II the group perspective will play an even more important role than before. We have geared our structure to this and strengthened group supervision radically. This is a very important element of the new structure of supervision. In many supervisory processes undertaking-related and competence-related sections will in future work as a team: the group supervisor from the undertaking-related section is responsible for the group and all solo undertakings and acts as the central contact overall. That means supervision is no longer separated according to lines of business: all the undertakings of a group are supervised by one section, in accordance with the principle of ‘one face to the customer’. Alongside this, there are of course a number of specialist topics, for which specialist know-how is needed. To meet this need we have created the competence-related sections, which are responsible for deepening and developing their respective fields of expertise. The fact that these two types of section will be working together is what will now characterise the operational supervision of both groups and solo undertakings.

You mentioned issues that are becoming increasingly important. Can you give us any examples?

There are a whole bunch of them. Just think, for example, of collective consumer protection – here BaFin, and so Insurance Supervision as well, faces the prospect of new requirements. A further important example is new types of risk, such as in IT. Here the requirements regarding the quality, amount and frequency of data under Solvency II are increasing considerably and demanding exceptional know how, flexibility and reaction speed from us. The need for us to be flexible and able to react quickly also applies quite generally, by the way. For that reason we have set up a separate unit for event-driven, project-related and topic-related audit campaigns – i.e. a sort of rapid deployment force that will significantly increase the clout of supervision. It will be able to tackle subjects rapidly, flexibly and in a focused manner, be it claims handling by insurers or questions of sales compliance, to mention just two examples. But for such topics as asset liability management, life and health insurance actuary work or investment reports we thought it also seemed sensible to bring together all the available know-how in special units. That way, we can tackle the duties and challenges facing us better and more efficiently. I am convinced that this is a fertile breeding ground for top-quality supervision.

What is changing for insurers?

Communication between BaFin and insurers – especially groups – will become very much more efficient. Because the undertaking-related sections will be acting as interfaces with insurers and will bear comprehensive responsibility for all matters that concern the undertaking or group in question, the number of contacts and interfaces for insurers will be reduced. This is a significant advantage that undertakings are gaining from the development of Insurance Supervision. We shall inform undertakings individually of who the respective contact will be and what processes are changing.

The goalposts were moved, so to speak, on 1 July. What about processes that had kicked off before then?

In some cases it will make sense to still transact processes in accordance with the former responsibilities. We will decide that quite pragmatically on a case-by-case basis. But it is more important that we now concentrate on the new processes and on ensuring that the dovetailing of the work of the undertaking-related and competence-related sections and their interaction with the insurance undertakings under their supervision are as much of a success as possible.

Number of staff

• Insurance Supervision Directorate total: ca. 360
• of which in operational supervision: ca. 75 per cent