IAIS finalises comparability criteria for Aggregation Method

Written by Adam Cadle

09/03/2023

The IAIS has agreed on the criteria that will be used to assess whether the Aggregation Method (AM) provides comparable outcomes to the Insurance Capital Standard (ICS).

The IAIS is developing the ICS as a consolidated group-wide capital standard for Internationally Active Insurance Groups (IAIGs). The ICS will provide a common language for supervisory discussions of group solvency of IAIGs and enhance global convergence among group capital standards. While not part of the ICS project, the US is developing an AM to a group capital calculation, which, if deemed comparable, will be considered an outcome-equivalent approach for implementation of the ICS as a prescribed capital requirement.

Assessment of whether the AM provides comparable outcomes to the ICS will now begin in Q3 2023.

“The finalisation of the comparability criteria, through a robust and transparent process, marks further progress toward our commitment to assess whether the AM provides comparable outcomes to the ICS”, Vicky Saporta, IAIS executive committee chair, said.

“Stakeholder feedback was particularly important to ensure a broad range of perspectives on the appropriateness of the criteria, and we are pleased with the breadth of input.”

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