Swiss Solvency Test (SST)

The Swiss Solvency Test (SST) is used to assess the capital strength of an insurance company. Insurance companies are required to submit an SST report to FINMA for review at least once a year. 

The Swiss Solvency Test (SST) is a modern supervisory tool which adopts a risk-based and total balance sheet approach. Insurance companies are required to provide a market-consistent assessment of the value of their assets and liabilities. Possible changes to these balance sheet positions are then modelled over a one-year period in order to arrive at the total required capital.

Fact sheet: The Swiss Solvency Test

The Swiss Solvency Test (SST) is designed to capture the economic risk situation of insurance companies.

Updated: 01.02.2018 Size: 0,11  MB
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Adequate capitalisation

The solvency requirement is met if the available capital (risk-bearing capital) exceeds the required capital (target capital). An insurance company's capitalisation is adequate if it is likely to be able to meet all its obligations to insured persons, even under unfavourable conditions.

SST solvency requirements

Predefined intervention thresholds

The principles underlying the SST are equivalent to those set out in Solvency II (the corresponding project in the EU). The SST has been in force since 1 January 2011. It has become an indispensable tool for FINMA, allowing it to identify solvency problems in good time and take corrective action on the basis of predefined intervention thresholds. FINMA specialists review the SST reports submitted annually by insurance companies.

The documents  listed below are intended primarily for insurance companies, groups and conglomerates which are obliged to perform the SST. They relate to the annual SST report, potential additional reports and reports on internal models.

SST reporting: conceptual basis

Circular and guidelines

2017/03 FINMA Circular "SST" (07.12.2016)

Swiss Solvency Test (SST)

Updated: 07.12.2016 Size: 0,34  MB
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Tools

SST standard models

Internal models