Loss-absorption proposals for systemically important insurers flawed

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Proposals to increase the capital held by global systemically important insurance groups (G-Siis) are flawed and could lead to regulatory arbitrage, experts are warning.

The International Association of Insurance Supervisors (IAIS) is consulting on policy measures to reduce the risk of G-Siis harming the global financial system in the event that one collapses.

The IAIS proposes that G-Siis should hold additional capital, a so-called higher loss-absorption (HLA) capacity, to insulate against low

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