International prudential developments

IAIS should avoid unnecessarily increasing data reporting burden


Insurance Europe has responded to a consultation conducted by the International Association of Insurance Supervisors (IAIS) on the Individual Insurer Monitoring (IIM) assessment methodology.

While recognising the IAIS’s mandate to continually evolve and improve the IIM assessment methodology, the European insurance industry takes the view that the most important consideration should be to stabilise, or preferably streamline, the IIM data collection.

Further additions to the templates and indicators are not considered to bring material benefits to the primary objective of the Global Monitoring Exercise (GME): ie to detect key risks and trends and the potential build-up of systemic risk. Instead, they create additional burdens for participating insurers.

Insurance Europe does not support the IAIS’ decision to introduce five new ancillary liquidity indicators. The use of multiple indicators and time horizons is considered to be unnecessary given the low level of macroprudential liquidity risk in the insurance sector.

Insurance Europe does not support the development of further ancillary indicators for reinsurance or credit risks. The need to develop such indicators does not appear to be substantiated by empirical evidence of macroprudential risks in the insurance sector.

Insurance Europe does not support the removal of the financial guarantees indicator. The classification and weighting of systemically important activities in the scoring should depend not on insurance companies’ current business model and activities, but on the assessment of systemic relevance and systemic risks.