IAIS has published proposed policy measures for Global Systemically Important Insurers (G-SIIs). It builds on the frameworks developed by FSB, covering supervisory intensity and coordination, resolvability and higher loss absorbency (HLA):

  • enhanced supervision. Supervisors should have powers to carry out consolidated group supervision. They should also require arrangements for liquidity risk management and the production of a Systemic Risk Reduction Plan by each G-SII. This plan may include separation of non-traditional and non-insurance (NTNI) activities or prohibition of systemically important activities;
  • effective resolution. The supervisors will establish crisis management groups, conduct resolvability assessments and adopt cross-border cooperation arrangements for individual firms. G-SIIs will have to elaborate recovery and resolution plans that consider the separation of NTNI activities or portfolio transfers; and
  • HLA. If NTNI activities have been effectively separated from traditional insurance, HLA requirements will be targeted on them. A group-wide assessment will determine whether the HLA capacity held by NTNI entities is sufficient or capital needs to be increased at group level.

These measures are open for consultation until 16 December, with the first designation of G-SIIs expected to take place in April 2013. (Source: IAIS Policy Measures for G-SIIs)