The February issue of the IAIS newsletter highlights that the global insurance sector plays a cornerstone role in the management of climate-related risks and opportunities for individuals, households, firms, other financial institutions, and public authorities. There is an increasing consensus across the financial sector that the potential systemic impact of climate change requires a similarly systemic global response, exemplified by work at the international level by the G20 and FSB. A growing number of insurance supervisors are examining the relevance of climate risks for insurance supervision, both individually and collaboratively through the Sustainable Insurance Forum (SIF).
The newsletter notes that IAIS is collaborating with SIF to develop an issues paper on climate-related financial disclosures for the insurance sector. This topic aims to open the dialog between insurance regulators, regulated firms, and other stakeholders around awareness of climate-related disclosures, use of scenarios and metric,s and support of the development of best practices to be considered by insurers in their financial disclosures. The newsletter further highlights that IAIS hosted an Insurance Capital Standard (ICS) stakeholder event on February 01, which gave members and stakeholders another opportunity to provide feedback on the ICS prior to the finalization of ICS Version 2.0 for the monitoring period.
Additional key updates for this month are as follows:
- The Capital, Solvency and Field Testing Working Group (CSFWG) met in Basel from January 28-31 to finalize its recommendations on 2019 Field Testing of ICS Version 2.0. These recommendations will go to the Policy Development Committee and the Executive Committee for endorsement at their meetings in late February.
- At its meeting on February 5-6, the Governance Working Group discussed the 2018 public consultation comments on ComFrame material in Insurance Core Principle (ICP) 5 on suitability of persons, ICP 7 on corporate governance, and ICP 8 on risk management.
- At its meeting on February 13-14, the Working Group discussed 2018 public consultation comments on ComFrame material in ICP 9 on supervisory review and reporting; ICP 10 on preventive measures, corrective measures, and sanctions; ICP 23 on group-wide supervision; and ICP 25 on supervisory cooperation and coordination.
- The Resolution Working Group met on January 23-24, with key items on agenda including a discussion of outcomes of the July 2018 draft ComFrame consultation and the November 2018 consultation on a draft application paper on recovery planning.
- The Supervisory Material Review Task Force met on February 7-8 and discussed the resolution of comments from the consultation on the draft introduction to ICPs and ComFrame.
Keywords: International, Insurance, Newsletter, Comframe, ICP, Climate Related Risks, IAIS
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HKMA, together with the Banking Sector Small and Medium-Size Enterprise (SME) Lending Coordination Mechanism, announced a ninety-day repayment deferment for trade facilities under the Pre-approved Principal Payment Holiday Scheme.
The Advisory Scientific Committee of ESRB published a response, in the form of an Insights Paper, to the EBA proposals for reforms to the stress testing framework in EU.
MAS announced several initiatives to support adoption of the Singapore Overnight Rate Average (SORA), which is administered by MAS.
BoE updated the reporting template for Form ER as well as the Form ER definitions, which contain guidance on the methodology to be used in calculating annualized interest rates.
PRA published the policy statement PS19/20 on the final policy for extending coverage under the Financial Services Compensation Scheme (FSCS) for Temporary High Balance.
EBA published the final draft implementing technical standards for disclosures and reporting on the minimum requirements for own funds and eligible liabilities (MREL) and the total loss-absorbing capacity (TLAC) requirements in EU.
EBA published an erratum for the phase 2 of technical package on the reporting framework 2.10.
EC published the Implementing Regulation 2020/1145, which lays down technical information for calculation of technical provisions and basic own funds.
FFIEC, on behalf of its members that include US Agencies such as CFPB, FDIC, FED, NCUA, and OCC, issued a joint statement that sets out prudent risk management and consumer protection principles for financial institutions to consider while working with borrowers.
PRA, via the consultation paper CP12/20, proposed changes to its rules, supervisory statements, and statements of policy to implement certain elements of the Capital Requirements Directive (CRD5).