When it comes to health insurance supervision, the Swiss Federal Office of Public Health (FOPH) is responsible for mandatory health insurance and voluntary daily benefits insurance pursuant to the
Swiss Federal Law on Health Insurance (KVG, SR 832.10), while FINMA (the Swiss Financial Market Supervisory Authority) is responsible for supplementary insurance policies which fall under the
Swiss Insurance Contracts Act (ICA: SR 221.229.1).
Under the Insurance Supervision Act (ISA), health insurers are required to back policyholders' entitlements with tied assets; these are subject to investment regulations (FINMA Circular 08/18 - in
German or
French) which oblige the insurers to pursue a cautious investment policy. For ICA business, solvency regulations must also be observed.
The ISA provides for preventative product controls in the area of supplementary health insurance and individual daily benefits insurance. This means that insurers may only offer these types of insurance policies once FINMA has approved their premiums and terms and conditions. This helps ensure that the rates are neither so high as to constitute an abusive practice nor so low so as to pose a risk to solvency, and that the terms and conditions of insurance adhere to applicable laws. The same applies when changes are made to the premiums charged for existing health insurance products.
In contrast to mandatory health insurance, under the ICA there is no obligation on the part of private health insurers to accept policyholders seeking supplementary insurance. Insurers are therefore free to decide whether they wish to insure somebody or not. In exchange for this, they waive their right of termination in the event of a claim. The most important types of insurance in terms of premiums are group daily sickness benefits insurance – which provides insurance for the continued payment of salary by the employer in the event of illness – and supplementary hospital insurance.
The insurers are private insurance companies under the ISA and health insurers. The market share of private insurers has increased steadily since the KVG was introduced in 1996, reaching over 80% in 2008.