However, a number of member jurisdictions’ national laws implementing the investment rules of the current Solvency I Directives15 do refer to, or place reliance on, ratings in order to determine whether a certain asset is authorised or eligible to cover technical provisions. Moreover, in a number of member jurisdictions, (re)insurance undertakings are required, as part of their internal reinsurance policy, to pay special attention to the financial strength of their reinsurers, using ratings as a proxy. For example, in the Netherlands, when pension funds reinsure their assets, they must maintain buffers to cover the risk of the reinsurance company.
