Internal control system

(1) Insurance undertakings must have an effective internal control system that comprises, at a minimum, administrative and accounting procedures, an internal control framework, and appropriate internal reporting at all levels of the undertaking. In addition, the internal control system must have a function for monitoring compliance with requirements (compliance function).
(2) The tasks of the compliance function include advising the management board on compliance with the laws and administrative provisions applicable to the conduct of insurance business. The compliance function must also assess the possible effects of changes in the legal environment for the undertaking, and identify and assess the risk associated with a breach of legal requirements (compliance risk).
(3) Insurance undertakings must have appropriate systems and structures to be able to meet the requirements named in sections 40 to 42 and to provide the information required to be submitted to the supervisory authorities under this Act.
(4) Undertakings must set out, in written internal policies approved by the management board, how the continued appropriateness of the information to be published and to be submitted is to be ensured.