1. Which financial activities are supervised? European experience
Banking
Insurance
Asset management

2. Why supervision of financial activities?
The reliability and functioning of the financial industry is of national interest.
Solvency supervision. Ensure that the company can meet the (future) liabilities. The accounting rules differ per country and activity
Consumer (supplier and investor) protection. A combination of maximum safety and profit

3. Organisation of the supervision
A trend to integrate the separated supervision activities in one national body
Grouping of bank-, insurance- and asset-management companies. New integrated cross-sectoral products.
More efficiency and less co-ordination costs with a comprehensive full-scale overview of the market
The national voice has more impact in Europe

4. Supervision of Health insurance
The differences in supervision of public and commercial insurance are evident
Public healthcare insurance by a legal entity under the the Ministry of Health
Package and regulations by Ministry of Health
In close co-operation with the health providers
Social business
Commercial healthcare (incl. supplementary) insurance by a legal entity under the Ministry of Finance
Close connected to other financial industries
Commercial business

5. Supervision of public and commercial health insurance undertakings
A tendency from detailed daily process-control to financial end-control, but:
Public funds are most intensively (day by day) controlled (incl.quality)
Public funded enterprises. Non-profit enterprises
Subscribers’ power to influence quality is very weak
Mostly compulsory. No freedom of choice
Commercial funds are less intensively controlled
Private premium collection. Full profit enterprises
More clients’ influence. When dissatisfied, they can resign.
The market will regulate more (but safety for all!)

6. Licensing
Before granting authorisation the supervision body conducts a comprehensive legal/financial study:
Met the legal conditions
Evidence of own funds
Operation Plan
Management of good education and reputation
In case of mismanagement:
Advises or directives to improve
Dismissal of management
Stop the license
Stop the business

7. On-going supervision On-going monitoring: Information by:
Still sufficient provisions and uncommitted funds in balance with the risk taken
Reinsurance to a appropriate degree
Changes in the business strategy and the environment
Changes in the operation
Information by:
All types of notifications
Audit reports
Management Information System
Free access to the Board and all operations

8. Countries differ
Prior approval of General Conditions, tariffs and (changes in) premiums
Actuarial directives
When to involve a trustee actuary
Reserves for the old age and chronic diseases
Complaints handling
Responsible for training programs
In public healthcare insurance:
Advise in new building/supply of care institutes
Risk equalisation between funds
Settlement of claims/payments abroad

9. Solvency requirements
Dependent on risk
Differ for public and commercial funds. A public fund has more risk sharing and so lower requirements
Calculated as a percentages of the premium and the experienced claims. For public funds are minimum and maximum requirements. An example:
A public fund: minimum is 8% of the risk (future years) and the maximum is 2,5 times that amount
A commercial fund: 16% of the premium or 23% of the average 3 years claims. The highest outcome is the requirement (mostly the 23%)

10. Quality control of public funds is essential
Supervisory bodies are focused on financial aspects
Clients of the public system complain about quality of service but have not enough power. Statutory quality control (Quality Law) works as consumer protection
Quality control by the fund itself is not sufficient
Usually the supervisory body is responsible, but there is a tendency to use specialised quality institute
Quality control of the public healthcare providers is a must too. This is done by public health fund but preferable by specialised institute

11. Commercial insurers are under the rules of the free market
Commercial insurers are under the rules of the free market. Quality is a matter of survival
Clients of a commercial institute are far more powerful. They can resign!
Market requires quality of the insurer (and health provider)
Commercial insurers have Quality Management Systems and Complaints Programs in place
There is a tendency to use specialised quality institutes
Commercial insurers control the provider very intensive

12. Summary and advises
Supervision is essential. Public healthcare insurers are supervised more intensive then commercials
The healthcare needs are evident
Equal access for all in full solidarity and high quality
But: the Slovakian healthcare debts are enormous
So:
Supervise the funds to support the management
Limit the public benefits to the essentials
Introduce voluntary healthcare insurance to generate extra money flow