G-Siis: regulatory clash puts derivatives use in doubt

Insurers say IAIS proposals contradict risk-based capital rules on derivatives use

two-directions
G-Siis must balance systemic and prudental rules that seem to disagree

Systemic regulation and solvency regulation are pulling the world’s biggest insurers in opposite directions, leaving them uncertain how – or whether – they will be able to use derivatives under future rules.

The cause of this regulatory ‘catch-22’, as one risk manager terms it, is a clash of perspectives. The first – enshrined in risk-based capital (RBC) regimes such as Solvency II – sees derivatives as a helpful tool to manage risk. The second, that of systemic rule-setters, sees derivatives as

Only users who have a paid subscription or are part of a corporate subscription are able to print or copy content.

To access these options, along with all other subscription benefits, please contact info@risk.net or view our subscription options here: http://subscriptions.risk.net/subscribe

You are currently unable to copy this content. Please contact info@risk.net to find out more.

Sorry, our subscription options are not loading right now

Please try again later. Get in touch with our customer services team if this issue persists.

New to Risk.net? View our subscription options

The future of life insurance

As the world constantly evolves and changes, so too does the life insurance industry, which is preparing for a multitude of challenges, particularly in three areas: interest rates, regulatory mandates and technology (software, underwriting tools and…

Most read articles loading...

You need to sign in to use this feature. If you don’t have a Risk.net account, please register for a trial.

Sign in
You are currently on corporate access.

To use this feature you will need an individual account. If you have one already please sign in.

Sign in.

Alternatively you can request an individual account here