French Insurance Code
In forceMutual insurance companies other than those referred to in Sections VI and VII of this Chapter are not required to obtain the administrative authorisation provided for in Article L. 321-1 if the following conditions are met:
1° Before commencing their operations, they have entered into a reinsurance treaty with a mutual insurance association under the conditions defined in Articles R. 322-107 to R. 322-117 ;
2° This treaty fully substitutes the union for the reinsured companies, for all their operations, for the constitution of the guarantees provided for by the insurance regulations and the fulfilment of the insurance commitments made by the reinsured companies;
3° They have obtained the prior agreement of the Autorité de contrôle prudentiel et de résolution explicitly stating that they are exempt from authorisation. This agreement is based on the compliance of the treaty and articles of association with the provisions of this section and on the financial situation of the association.
Operations carried out pursuant to the said reinsurance treaty by a mutual association which replaces the companies which it reinsures, under the conditions defined in this article, are considered under the provisions of this code as direct insurance operations of the mutual association.
Notwithstanding Article R. 322-47, the number of members of a company reinsured under the conditions defined in the previous paragraph may not be less than 7. The total number of members of companies reinsured by a mutual union under the conditions set out in the previous paragraph may not be less than 2,000.
Any amendment to the reinsurance treaty is subject to the prior authorisation of the Autorité de contrôle prudentiel et de résolution.
The reinsured companies referred to in the first paragraph of this article are exempt from the obligation to set up an establishment fund and a solvency margin. They are not required to appoint a statutory auditor.
