The Danish Financial Supervisory Authority is currently conducting an inspection in Alpha Insurance A/S. The scope of the inspection is methods for claims reserving and solvency. During the inspection, the Danish Financial Supervisory Authority suspected that the valuation of Alpha Insurance A/S’ receivables were too optimistic. Therefore, the Danish Financial Supervisory Authority engaged in discussions with Alpha Insurance A/S about the valuation of the receivables.
It is the Danish Financial Supervisory Authority’s assessment that the counterparties of the two receivables are unlikely to be able to meet their obligations towards Alpha Insurance A/S based on their current financial situation. Consequently, the Danish Financial Supervisory Authority has ordered Alpha Insurance A/S to reduce the value of the two receivables by DKK 35.6 million such that the valuations reflect the ability of the counterparts to meet their obligations towards Alpha Insurance A/S.
The Danish Financial Supervisory Authority expects that this order will cause Alpha Insurance A/S’ eligible own funds not to be sufficient to meet the Solvency Capital Requirement. In this case, the Danish Financial Supervisory Authority will order Alpha Insurance A/S to submit a recovery plan.
The Danish Financial Supervisory Authority notes that the assessment of the valuations of intra-group transactions has yet to be finished.
The Danish Financial Supervisory Authority is continuing the inspection of Alpha Insurance A/S.
The Danish Financial Supervisory Authority has informed the host national supervisory authorities via an European Insurance and Occupational Pensions Authority (EIOPA) Cross-Border Platform of Collaboration about the order issued to Alpha Insurance.