The Swiss Tied Asset regime means that there is a distinct pool of assets attributable to the direct policyholders of ZIC’s Swiss business as well as ZIC’s foreign business. The amount of Tied Assets which are to be held is determined by a formula based on the underlying technical reserves and further insurance liabilities. For assets to be eligible as Tied Assets, the assets must comply with certain requirements set out by the Swiss Financial Market Supervisory Authority (“FINMA”) and be earmarked or held in segregated accounts. Policyholders who were covered by the Swiss Tied Assets regime would have first access to these Tied Assets should there be a general winding-up of the insurance business.
Policies issued by ZIC’s foreign business are backed by the technical reserves required by local rules and were additionally subject to Swiss Tied Asset rules in certain jurisdictions, including Singapore. However, upcoming regulatory changes will now prohibit ZIC from setting aside or using Tied Assets to cover the liabilities of the Zurich Singapore policyholders.
ZIC Singapore’s customers will continue to benefit from Zurich Singapore’s very strong and locally regulated balance sheet, backed by the Zurich Group’s AA financial strength.
For the avoidance of doubt, assets held by ZIC in its capacity as Group holding company and reinsurance entity, including relating to central capital and liquidity facilities, are not subject to the Swiss Tied Asset Rules.