DNB policy rule resolvability of insurance companies 2023

Special News Update Financial Regulatory

DNB policy rule resolvability of insurance companies 2023
10 mei 2023

Insurance Companies need to comply with several requirements relating to recovery and resolution. If an insurer is considered to be failing or likely to fail, DNB can ultimately resolve that insurer using an entity-specific resolution plan. To ensure resolvability, DNB has to identify impediments to resolution early on and instruct insurers how to remedy them. Insurers need to remedy these impediments as a matter of urgency. 

The new Dutch Central Bank (DNB) Policy rule on resolvability of insurance companies 2023 (Beleidsregel afwikkelbaarheid verzekeraars) was published in the Dutch Official Gazette on 5 April 2023. This document is only available in Dutch. The policy rule specifies in detail the criteria DNB has to take into account when identifying impediments to resolution in relation to Dutch insurance companies. 

In this Special News Update, we take a closer look at the criteria DNB will apply to determine resolvability. Although the policy rule is addressed to DNB, it contains valuable guidance for insurers. 

DNB | Policy rule on resolvability of insurance companies 2023

Pursuant to Article 3a:81 Financial Supervision Act (Wet op het financieel toezicht), DNB has to compose a resolution plan for each insurance company in its remit. This resolution plan sets out the specific resolution strategy DNB will apply towards that insurer, taking into account its key characteristics, such as its insurance products, critical functions, and organisational and geographical set-up. If an insurer faces a failing or likely to fail scenario DNB may decide to execute the resolution plan.

Pursuant to Article 3a:82 Financial Supervision Act, DNB has to identify impediments to resolution, i.e. circumstances relating to an insurer that would substantially impact the executability of the DNB resolution plan for that insurer. The policy rule describes six areas DNB has to take into account when determining whether there are any impediments to resolution warranting immediate remediation: governance, operational continuity, financial continuity, management information systems (MIS), communication and legal structure/manageability. This is not an exhaustive list. Each of these areas has to be adequately aligned with the recovery plan, recoverability and ultimately resolvability. 


Insurers need to demonstrate that resolution planning and resolvability are embedded in their governance. This requires, for example, adequate reporting lines and escalation mechanisms towards board and senior management, as well as adequate approval mechanisms. Further, insurers need to take into account resolvability aspects when making decisions materially impacting their legal structure, operational business model, IT structure, governance, or risk and capital management. 

Operational continuity

Insurers need to demonstrate that they have adequate arrangements ensuring the operational continuity of critical services prior to and during resolution. This includes having adequate arrangements in place to safeguard the operational continuity of critical services, including adequate funding to cover the costs of those services, as well as an overview of all critical services whose operational continuity in resolution is uncertain, and the possible consequences of unavailability.

Financial continuity

Insurers need to have adequate mechanisms to determine the liquidity need prior to and in resolution, and to make forecasts, as well as arrangements to safeguard access to critical financial counterparties in resolution. In the event that such access is uncertain, there must be an overview of the possible consequences of such unavailability.


Insurers need to have an adequate MIS in place. The MIS has to ensure the insurer can accurately and promptly provide DNB with all information relevant to DNB for the drafting, updating and if necessary execution of the resolution plan. The MIS should also ensure adequate information is available to the external valuator/DNB for performance of the valuations as part of the resolution process. DNB will assess the readiness of the MIS as part of its ongoing resolution planning, particularly the extent to which insurers can provide adequate, complete and timely information in the going concern situation, following DNB data requests for resolution planning purposes.


Insurers need to have an adequate crisis communication plan, taking into account relevant roles and responsibilities as well as all internal and external stakeholders. DNB will assess whether the plan reflects the expected communication processes and the relevant internal and external stakeholders, including whether the plan is tailored to the needs of the different types of stakeholders.

Legal structure/manageability

DNB will assess whether an insurer's legal structure aligns with its factual business. The extent to which the legal structure or the factual business conduct may impede the execution of the resolution plan is also relevant. DNB will also consider whether the insurer takes account of the resolution perspective when taking strategic decisions in the 'business as usual'/going concern phase.

Although the policy rule is addressed to DNB, it contains valuable guidance for insurers, as it specifies the key topics DNB will assess when determining insurers' resolution readiness. As such, insurers should use this guidance when determining their own resolution readiness. 

If you have any financial regulatory questions, please do not hesitate to contact Berry van Wijk, Juan Vervuurt or Gijs Hamelijnck.
Written by:
Berry van Wijk

Key Contact

Advocaat | Partner

Key Contact

Advocaat | Counsel
Gijs Hamelijnck

Key Contact

Advocaat | Senior Associate