Composite Insurer (Kompositversicherer)
A composite insurer is an insurance undertaking that writes both life and non-life insurance business, a model that is restricted or no longer permitted under the supervisory law of many jurisdictions.
Concept
A composite insurer is an insurance undertaking that writes both life insurance and non-life insurance business (property, liability, health, and accident insurance) within a single legal entity. This business model was historically widespread in many European markets before supervisory separation requirements were introduced.
Separation Requirement (Line-of-Business Segregation)
Because of the differing risk profiles, capital requirements, and durations of life and non-life business, many jurisdictions – including the EU solvency directives – mandate a separation requirement under which life and non-life business must be conducted through separate legal entities (primary insurance undertakings). Grandfathering provisions, however, allow certain historically established composite insurers to continue their mixed business.
Relevance for Group Structure
Insurance groups wishing to offer both life and non-life business generally organize this through separate subsidiaries within a common insurance holding company, in order to comply with regulatory separation requirements while still capturing synergies in distribution and group management.