The Swiss Financial Market Supervisory Authority (FINMA) has outlined its supervisory priorities for 2026, providing important signals about the regulatory landscape for Swiss insurers and reinsurers. The priorities reflect both global regulatory trends and Switzerland-specific concerns, with particular emphasis on climate risk, operational resilience, and governance quality.
Climate and Environmental Risk
Climate risk has moved to the top of FINMA’s supervisory agenda for insurers. Building on its 2022 guidance on climate-related financial risks, FINMA expects supervised insurance entities to demonstrate concrete progress in integrating climate considerations into their risk management frameworks, underwriting processes, and investment strategies.
Specific expectations include quantitative climate scenario analysis covering both physical and transition risks, board-level climate risk governance, and transparent disclosure of climate-related exposures. FINMA has signalled that future supervisory reviews will assess the quality and depth of climate risk integration, with implications for individual insurer risk assessments and potential capital add-ons for entities with inadequate climate risk management.
Operational Resilience and Cyber Security
The increasing digitisation of insurance operations and the growing sophistication of cyber threats have placed operational resilience firmly within FINMA’s supervisory focus. Swiss insurers are expected to maintain robust business continuity frameworks, with particular attention to critical business processes, third-party dependency management, and cyber incident response capabilities.
FINMA’s operational resilience expectations extend to third-party risk management, reflecting the insurance industry’s increasing reliance on cloud computing, data analytics platforms, and outsourced business processes. Supervised entities must demonstrate adequate oversight of material outsourcing arrangements and ensure that service provider dependencies do not create unacceptable concentration or disruption risks.
Governance and Risk Culture
FINMA continues to emphasise the importance of effective corporate governance and strong risk culture within supervised entities. Areas of particular focus include board composition and competence, the independence and effectiveness of risk management and compliance functions, and the alignment of remuneration structures with prudent risk-taking.
The regulator has also indicated heightened scrutiny of related-party transactions, intra-group risk transfers, and governance arrangements within complex group structures. For internationally active Swiss insurance groups, this scrutiny extends to the oversight and control of foreign subsidiaries and branches.
Swiss Solvency Test Developments
FINMA has signalled ongoing refinements to the Swiss Solvency Test (SST), including enhanced calibration of certain risk factors and improved treatment of new risk categories. While no fundamental restructuring of the SST is planned, incremental adjustments to reflect evolving risk landscapes are expected, particularly in the areas of climate risk, cyber risk, and geopolitical concentration.
Industry Response
Swiss insurers have generally welcomed FINMA’s supervisory priorities as proportionate and aligned with international best practices. The challenge for many firms lies in the resource intensity of simultaneous compliance with climate risk requirements, operational resilience standards, and enhanced governance expectations, while maintaining competitive positioning in global markets.