IAIS plans group supervision framework by 2013

The International Association of Insurance Supervisors (IAIS) is set to impose guidelines for the supervision of international insurance groups by 2013, which will set out quantitative and qualitative requirements for group insurers and provide a platform for supervisory interaction and implementation.

Recommendations, to be announced at the end of February, for the process of developing
a common framework for standardising the supervision of international insurance groups across its members were drawn up by a taskforce chaired by Monica Mächler of the Swiss Financial Market Supervisory Authority.

They will stress the framework will need to address improving the monitoring of group structures, business mix and intra-group transactions, to flag up risks and establish safeguards.

“The framework will put internationally active insurance groups on a similar footing and allow home and host supervisors to better understand and supervise such groups,” said Peter Braumüller, chair of the IAIS executive committee. “We are confident the framework will become an important contribution to our ongoing wider efforts to promote financial stability.”

The framework’s development will be run by the IAIS executive committee, with a consultation paper planned for the first half of 2011. This will be followed by quantitative impact assessments.