Public interest assessment in insurance and reinsurance resolution

This paper aims to discuss the concept of public interest in the Insurance Recovery and Resolution (IRR) Directive as one of the prerequisites for triggering the resolution process in an insurance or reinsurance undertaking and propose a practical approach to the assessment of that interest. Public interest seems to be the most critical factor, while public interest assessment the most crucial procedure in making the decision to initiate the process. However, the concept is very laconically described in the legal text. The paper develops ideas from the defi nition of the public interest in the IRR Directive: four resolution objectives, their hierarchy, the possibility of measuring and quantifying them, proportionality of resolution action, impact of degree of objectives achievement and proportionality on the fi nal decision and on the selection of resolution tools, to propose a coherent decision-making process, consistent with the provisions and spirit of the IRR Directive. The above-mentioned process aims to be a practical framework for the assessment of the public interest in the insurance and reinsurance sector in the prospective resolution proceedings.