The International Association of Insurance Supervisors (IAIS) Fifth Annual Conference: New Global Insurance Standards Adopted
6 October 1998
The International Association of Insurance Supervisors (IAIS) representing insurance supervisors from around the world held its Fifth Annual Conference in Cancún, Mexico from 28th September to 1st October 1998.
Established in 1994, the IAIS seeks to establish international standards on insurance supervision and conducts training seminars for insurance supervisors from emerging markets. The Association also seeks to coordinate its efforts with other global financial regulators, particularly those from the banking and securities industries.
Three new standards on insurance supervision approved at the General Meeting of members will contribute to improved supervision of the insurance industry at the domestic as well as the international level. They were developed in consultation with industry and professional bodies.
The first, the "Supervisory Standard on Licensing", identifies the requirements that should be met by an insurance company seeking a licence and also covers the standards that apply to the licensing procedure itself. Licensing plays an important role in insurance markets by encouraging efficiency and stability.
The second is "Standards on On-Site Inspections". On-site inspections are important tools for supervisors to obtain reliable data and information in order to assess a company's current and prospective solvency. The paper lays down the procedures and standards for the organisation of on-site inspections.
The third standard, "Supervisory Standard on Derivatives", provides guidance to supervisors in assessing how insurers control risks in derivatives, as IAIS members recognise that the supervisory approaches taken by member jurisdictions are evolving in response to developments in derivatives markets.
The IAIS encourages members to comply with its insurance supervisory principles and has developed a self-assessment programme for members. The results of this self-assessment were presented at the Conference.
The IAIS actively promotes implementation of its supervisory standards by offering effective training programs. In the previous year, the IAIS in collaboration with other organisations conducted five training seminars for insurance supervisors in several regions throughout the world.
Incoming Executive Committee Chairman Hanley Clark promised that the IAIS would continue to develop insurance supervisory standards, and announced that the IAIS would organise several regional seminars and provide training for supervisors during the next year. He stated that it is important that the IAIS continue to work with other financial sector regulators on issues such as the Year 2000 problem and supervision of financial conglomerates.
He emphasised that the Year 2000 issue is particularly pressing and said the IAIS would address this issue in collaboration with the Basle Committee on Banking Supervision (Basle Committee), the International Organization of Securities Commissions (IOSCO), the Committee on Payment and Settlement Systems (CPSS) and other organisations.
The sixth IAIS Annual Conference will be held in San Francisco in December 1999.
Contact: Knut Hohlfeld Phone: +41-61-280-91-34