IAIS Standards Setting Activities and the
Insurance Core Principles
Washington – 4 May 2004
Luc Cardinal – Member of Secretariat
International Association of Insurance Supervisors (IAIS)
Website: www.iaisweb.org
1. IAIS Principles
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Insurance Core Principles
Supervision of international insurers
Conduct of insurance business
Insurance activities on the internet
Capital adequacy and solvency
Supervision of reinsurers
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IAIS standards setting activities and the Insurance Core Principles
2. IAIS Standards
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Licensing
On-site supervision
Derivatives
Asset management
Group coordination
Exchange of information
Evaluation of the reinsurance cover
Supervision of reinsurers
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IAIS standards setting activities and the Insurance Core Principles
3. IAIS Guidance papers
• Supervision in emerging market economies
• Model memorandum of understanding for
exchange of information
• Fit and proper principles and application
• Public disclosure by insurers
• Anti-money laundering and combating the
financing of terrorism
• Solvency control levels
• Use of actuaries
• Stress testing
• Investment risk management
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IAIS standards setting activities and the Insurance Core Principles
4. IAIS Structure
General Meeting
Secretariat
Executive Committee
Budget Committee
Emerging Markets Committee
Secretariat
Working Group on Observership & Membership Issues
Dialogue Group
Education Subcommittee
Task Force on the Core Curriculum Project
Task Force on the Revision of the By-laws
Technical Committee
Insurance Laws, Regulations, Practices
& Standards Subcommittee
Task Force on Assessment
& Implementation of ICPs
Investments Subcommittee
Financial Conglomerates Subcommittee
Subcommittee on Enhanced Disclosure
Insurance Fraud Subcommittee
Solvency & Actuarial Issues Subcommittee
Accounting Subcommittee
Working Group on Electronic
Commerce/Internet
Task Force on Enhancing Transparency
& Disclosure in the Reinsurance Sector
Reinsurance and Other Forms of Risk Transfer
Subcommittee
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IAIS standards setting activities and the Insurance Core Principles
5. IAIS Standard Setting
• Pyramidal approach
Core
Principles
Principles
Supervisory Standards
Guidance & Issues Papers
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IAIS standards setting activities and the Insurance Core Principles
6. IAIS Document Adoption
Working party
Drafting and consultation
WP Members
Some Observers
IAIS Members & Observers
Technical and Executive Committees
Review and approval
IAIS Members & Observers
General Meeting
Final adoption and publication
(hopefully!)
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IAIS standards setting activities and the Insurance Core Principles
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7. History of Insurance Core Principles
• The first ICPs adopted in October 2000, based on
1997 Insurance supervisory principles
• FSAP (the Financial Sector Assessment Program)
started in 1999
• Joint Forum comparison of the core principles in
banking, insurance and securities sectors in 2001
• FSAP experiences
• Revision of ICPs
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IAIS standards setting activities and the Insurance Core Principles
8. 12 key standards for sound financial systems
(by Financial Stability Forum)
• Code of Good Practices on
Transparency in Monetary and
Financial Policies (by IMF)
• Code of Good Practices in
Fiscal Transparency (by IMF)
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• Core Principles for
Systemically Important
Payment Systems (by CPSS)
• Recommendations for
Securities Settlement
Systems (by CPSS/IOSCO)
• Special Data Dissemination
Standard / General Data
Dissemination System (by IMF)
• The Forty Recommendations
of the FATF/ 8 Special
recommendations Against
Terrorist Financing (by FATF)
• Principles of Corporate
Governance (by OECD)
• International Accounting
Standards (by IASB)
• International Standards on
Auditing (by IFAC)
• Core Principles for Effective
Banking Supervision (by BCBS)
• Objectives and Principles of
Securities Regulation (by IOSCO)
• Insurance Core Principles
(by IAIS)
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IAIS standards setting activities and the Insurance Core Principles
9. Insurance Core Principles (ICP)
Title
Insurance Core Principle
1. Introduction
Background, scope, implementation and assessment
2. Conditions
ICP 1: Conditions for effective insurance supervision
3. The supervisory
system
ICP 2: Supervisory objectives
ICP 3: Supervisory authority
ICP 4: Supervisory process
ICP 5: Supervisory cooperation and information sharing
4. The supervised entity
ICP 6: Licensing
ICP 7: Suitability of persons
ICP 8: Changes in control and portfolio transfers
ICP 9: Corporate Governance
ICP 10: Internal control
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IAIS standards setting activities and the Insurance Core Principles
10. Insurance Core Principles (ICP)
Title
5. Ongoing supervision
Insurance Core Principle
ICP 11: Market analysis
ICP 12: Reporting to supervisors and off-site monitoring
ICP 13: On-site inspection
ICP 14: Preventive and corrective measures
ICP 15: Enforcement or sanctions
ICP 16: Winding-up or exit from the market
ICP 17: Group-wide supervision
6. Prudential
requirements
ICP 18: Risk assessment and management
ICP 19: Insurance activity
ICP 20: Liabilities
ICP 21: Investments
ICP 22: Derivatives and similar commitments
ICP 23: Capital adequacy and solvency
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IAIS standards setting activities and the Insurance Core Principles
11. Insurance Core Principles (ICP)
Title
7. Markets and
consumers
Insurance Core Principle
ICP 24: Intermediaries
ICP 25: Consumer protection
ICP 26: Information, disclosure & transparency towards the market
ICP 27: Fraud
8. AML/CFT
ICP 28: Anti-money laundering, combating the financing of terrorism
Annex 1
References
Annex 2
Assessment methodology
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IAIS standards setting activities and the Insurance Core Principles
12. Implementation of IAIS standards
– Training and seminars
– Implementation tools
– Self assessment
– Provision of Technical Assistance
– Assisting FSAP
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IAIS standards setting activities and the Insurance Core Principles
13.Cooperation with others
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Regular discussion amongst supervisors
Joint Forum
Financial Stability Forum
International Accounting Standard Board
International Federation of Accountants
International Association of Actuaries
Financial Stability Institute
The World Bank
IMF
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IAIS standards setting activities and the Insurance Core Principles
14. IAIS Website Address
www.iaisweb.org
Luc Cardinal
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IAIS standards setting activities and the Insurance Core Principles