LONDON Feb 28 Global regulators have begun to
examine whether to introduce new rules from 2019 to contain
possible risks to the financial system from the activities of
large, international insurers.
The International Association of Insurance Supervisors
(IAIS) said it was developing an "activities-based" approach to
help determine the minimum amount of capital big, cross-border
insurers should be holding to protect policyholders.
The IAIS is already finalising broad capital buffers for
insurers based on the size and complexity of companies, which
are due to come in from 2022.
The approach based on looking at any risky activities
undertaken by insurers could lead to new rules coming in as
early as 2019, which would then shape the broader global capital
regulations due to be implemented three years later.
"This well-articulated workplan will allow the IAIS to
develop a comprehensive framework for the assessment and
mitigation of systemic risk, building on the work carried out so
far," Victoria Saporta, chair of the IAIS executive committee,
said in a statement.
Insurers identified as being globally-systemic in 2020, for
example, will need a "higher loss absorption" capacity, the IAIS
Insurers have long insisted they don't pose the same risks
to the global financial system as banks, some of which had to be
bailed out during the 2007-09 financial crisis.
The move by the IAIS echoes steps by global regulators to
look at risks from the activities of the fast-growing asset
management sector too.
(Reporting by Huw Jones; editing by David Clarke)