Featured Product

    IA Publishes Guideline on Enterprise Risk Management for Insurers

    July 05, 2019

    IA of Hong Kong published the guideline GL-21 on enterprise risk management, or ERM, for insurers. The guideline sets out the objectives and requirements on ERM and the Own Risk and Solvency Assessment (ORSA), in addition to providing the impetus for insurers to establish effective tools to identify, monitor, manage, and mitigate risks. GL-21 shall take effect from January 01, 2020. Additionally, to monitor the overall progress of the industry in enhancing their ERM frameworks of insurers, IA is conducting a Preparation Status Survey that insurers are expected to complete on the best effort basis. Insurers are requested to complete the survey in Excel file format and have it returned to IA by August 16, 2019.

    The main objective of the guideline GL-21 is to nurture a sound risk culture in the insurance industry that should be reflected in the values, attitudes, and norms of business behavior. The guideline sets out the requirements for Pillar 2 of the risk-based capital regime in Hong Kong and provides the impetus for authorized insurers to:

    • Put in place a robust system of risk governance
    • Proactively identify and assess their risk exposure
    • Maintain sufficient capital to cover risks not captured or not adequately captured under Pillar 1
    • Develop and enhance risk management techniques in monitoring and managing these risk exposures

    IA has finalized the guideline on ERM, post two consultations—one consultation was conducted in May 2018 while the second was conducted in January 2019. IA issues GL-21 pursuant to section 133 of the Insurance Ordinance (Cap. 41) and its principal function is to regulate and supervise the insurance industry for the protection of existing and potential policy holders. This guideline takes into account the relevant Insurance Core Principles (ICPs), standards, guidance, and assessment methodology promulgated by IAIS. This guideline is part of the Pillar 2 of the risk-based capital regime for the insurance industry in Hong Kong. The risk-based capital regime in Hong Kong comprises three pillars: Pillar 1 covers the regulatory capital rules and requirements, Pillar 2 covers corporate governance and ERM, and Pillar 3 covers reporting and disclosure requirements.

     

    Related Links

    Effective Date: January 01, 2020

    Keywords: Asia Pacific, Hong Kong, Insurance, ERM, ORSA, Regulatory Capital, Pillar 2, ICP, Risk-Based Capital Regime, IA

    Related Articles
    News

    PRA Finalizes Policy on Prudent Person Principle Under Solvency II

    PRA published the policy statement PS14/20, which contains the supervisory statement SS1/20 and the feedback to responses to the consultation paper CP22/19 on expectations for investment by firms in accordance with the Prudent Person Principle, or PPP, as set out in the Investments Part of the PRA Rulebook.

    May 27, 2020 WebPage Regulatory News
    News

    EBA on Extending Large Exposure Limits for French Systemic Banks

    EBA published an opinion following the notification by the French macro-prudential authority, the Haut Conseil de Stabilité Financière (HCSF), of its intention to extend a measure introduced in 2018 on the use of Article 458(9) of the Capital Requirements Regulation (CRR).

    May 27, 2020 WebPage Regulatory News
    News

    ECB Highlights NPL Resolution as Key Policy Issue in Post-COVID Europe

    As part of a Research Bulletin on the recent policy-relevant work, ECB published an article that examines the lessons learned from past crises for nonperforming loan resolution in the post COVID-19 period.

    May 27, 2020 WebPage Regulatory News
    News

    RBNZ Publishes Financial Stability Report for May 2020

    RBNZ published the financial stability report for May 2020. This review of the financial system in the country highlights that the economic disruption associated with COVID-19 will present challenges to the financial system.

    May 27, 2020 WebPage Regulatory News
    News

    ECB Updates Guidance on Reporting of Securities Holdings Statistics

    ECB updated the guidance notes for reporting related to the statistics on holdings of securities by reporting banking groups (SHSG).

    May 26, 2020 WebPage Regulatory News
    News

    ECB Publishes Results of Financial Stability Review in May 2020

    ECB published results of the financial stability review in May 2020. Among other issues, the financial stability review assesses operations of the financial system so far during the COVID-19 pandemic.

    May 26, 2020 WebPage Regulatory News
    News

    Regulators and Private Sector Meet to Discuss COVID Policy Responses

    Financial policymakers and international standard-setters met virtually with private-sector executives to discuss international policy responses to COVID-19 pandemic.

    May 26, 2020 WebPage Regulatory News
    News

    ESMA Responds to IASB Consultation on Interest Rate Benchmark Reform

    ESMA published a letter responding to IASB on the exposure draft on the phase 2 of the interest rate benchmark reform.

    May 25, 2020 WebPage Regulatory News
    News

    HKMA Consults on Supervisory Policy for OTC Derivatives Transactions

    HKMA is consulting on revisions to the Supervisory Policy Manual module CR-G-14 on margin and other risk mitigation standards for non-centrally cleared over-the-counter (OTC) derivatives transactions.

    May 25, 2020 WebPage Regulatory News
    News

    EBA Examines Impact of COVID Crisis on Banking Sector in EU

    EBA published thematic note presenting a preliminary assessment of the impact of COVID-19 outbreak on the banking sector in EU.

    May 25, 2020 WebPage Regulatory News
    RESULTS 1 - 10 OF 5221