ANNEX IISupplementary provisions
ANNEX II THE PRINCIPLES APPLIED TO INTERNAL WIND DOWN UNITS IN THE INSURANCE SECTOR Applicable while ING Group has full control of a business. Competition concerns (i) no new production, no underwriting of new policies with existing or new clients (absent contractual commitments or ALM purposes). (ii) exploring possibilities to terminate in force policies with the consent of clients (iii) no improvement of commercial conditions on in force policy (iv) where commercial conditions can be adjusted by the insurer the commercial conditions need to be set at the least advantageous possible level Viability concerns (i) periodically explore possibility of a sale as a whole or in parts of remaining assets and liabilities (yearly market sounding calls to be reported to Trustee; full documented market sounding every two years) (ii) ring fence the possible impact on the viable business through separation of accounts and clear cost allocation between good bank and run down business (iii) estimate future capital needs of the run down business in a conservative manner and allocate the necessary capital, in the form of provisions or other (iv) conservative management of assets relative to liabilities (reinvestment guidelines to be documented). (v) conservative hedging policy with a target hedge efficiency in the range of 80-120 % of the overall hedge objective, subject to materiality (vi) possibilities of partial or full reinsurance to be examined periodically (to be documented) (vii) above to be consistent with applicable local regulatory requirements and objectives