IAIS must focus on systemic activities of insurance sector ‘as a whole’, body argues

Written by Adam Cadle

21/08/2019

A greater focus by the International Association of Insurance Supervisors (IAIS) on potentially systemic activities of the insurance sector as a whole is warranted, Insurance Europe has argued.

In its response to an IAIS consultation on its new holistic framework for assessing systemic risk in insurance, Insurance Europe said “conventional risk is not systemically risky, and systemic risk can only originate from a very limited number of activities undertaken on a large scale in the wrong conditions”.

Insurance Europe added that there is a need for every jurisdiction to achieve comparable outcomes when applying the framework, to ensure a global level playing field. The body also stress the “the need for a strict and consistent application of the principle of proportionality”.

“It added that proportionality should not be limited to requiring insurers to apply a measure with different expectations of granularity; rather it means questioning whether an insurer shall be subject to a certain measure at all.”

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