Chile's Financial Market Commission (CMF) opened an eight-week consultation on a draft regulation setting conditions for life insurers to deduct reinsurance of life annuity obligations placed with foreign reinsurance entities from the calculation of technical reserves under General Rule No. 323. The proposal would cap eligible reserve deductions at 20 percent of technical reserves as measured on the contract date and require foreign reinsurers to hold an international risk rating equivalent to category A. It also conditions eligibility on the foreign supervisor having a memorandum of understanding with the CMF, or equivalent information-exchange arrangements, and requires assets backing transferred obligations to be held in a segregated fund managed by an entity supervised by the CMF, subject to portfolio limits including a maximum of 30 percent in foreign securities and 5 percent in other investments. Reinsurance contracts would need early termination (recapture) clauses, and companies would have to provide detailed quarterly reporting on the transactions. Comments can be submitted via the CMF’s Regulations Under Consultation webpage during the eight-week consultation period, alongside a supporting Regulatory Report.
Chile Financial Market Commission 2026-04-20
Chile's Financial Market Commission launches consultation on prudential rules for life annuity reinsurance with foreign reinsurers
The Chile Financial Market Commission has launched a consultation on draft rules setting conditions for life insurers to deduct reinsurance of life annuity obligations placed with foreign reinsurers from technical reserves. The proposal would cap eligible deductions at 20 percent of technical reserves, require foreign reinsurers to hold at least an international category A rating and be subject to supervisory cooperation arrangements, impose segregation and portfolio limits on backing assets, mandate early termination clauses, and introduce detailed quarterly reporting.