Featured Product

    IAIS and SIF Publish Paper on Implementation of TCFD Recommendations

    February 27, 2020

    IAIS and Sustainable Insurance Forum (SIF) published an issues paper on implementation of the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD). Recognizing the diversity of supervisory frameworks across jurisdictions, the paper identifies a number of areas in which supervisors can encourage strengthened disclosures through the application of existing supervisory tools. To support supervisory efforts to assess the impact of climate-related risks to the insurance sector and help resolve challenges, including around public disclosures, IAIS and SIF will further work on climate-related risks in the insurance sector during 2020; the work will be focused on topics such as enterprise risk management, corporate governance, investment, and disclosures. Additionally, IAIS published a Peer Review Process (PRP) Questionnaire related to the Insurance Core Principle (ICP) 19 on conduct of business.

    In June 2018, IAIS and SIF released a joint issues paper on climate change risks to the insurance sector. As a follow-up to the 2018 issues paper and recognizing the important role of the TCFD Recommendations in establishing a framework for climate-related disclosures for the insurance sector, IAIS and SIF agreed to develop this second issues paper. This paper provides an overview of practices that supervisors have considered in the development of climate-related disclosure requirements within their markets. Considering the diversity of supervisory frameworks across jurisdictions, this paper focuses on practices that can be implemented with limited direct regulatory intervention. The paper draws on the results of a SIF survey on implementation of the TCFD recommendations and supplemental guidance, which was conducted during the first half of 2019. Case studies submitted by SIF members support the formulation of options for supervisors that are included in Annex 1.

    Going forward, supervisors may seek to consider a range of broader issues stemming from increased climate risk as they may be relevant for supervisory objectives, including the following issues:

    • The potential for increasing climate risk to affect insurance pricing for vulnerable consumers—Supervisors could consider how to use TCFD-aligned disclosures as a springboard to explore how insurance sector climate risk intelligence can be used to strengthen government and consumer awareness, incentivize mitigation actions, and ultimately reduce exposures.
    • Implications of climate risks for long-term business model resilience—Strengthening climate risk transparency, including forward-looking scenario analysis, could illuminate the ways in which climate risks may impact insurance business model viability over the long-term.
    • Interactions between micro- and macro-prudential objectives—In the case of integrated supervisory authorities, strengthening climate risk transparency may have implications for a range of institutional objectives. Integrated frameworks, linking firm-level disclosures to system-level assessments, could help strengthen understanding of the impact of climate risks on individual firms as well as the impact of the sector as a whole on climate risk resilience within the financial system and broader economy.

    The IAIS and SIF recognize the value of developing further material to support supervisors in their efforts to assess climate risks, including in relation to the ICPs. The second issues paper is a step toward this objective and is intended to lay the groundwork for development of future work, such as an IAIS Application Paper.

     

    Keywords: International, Insurance, TCFD, Sustainable Finance, ESG, Sustainable Insurance Forum, Climate Change Risk, Disclosures, IAIS

    Featured Experts
    Related Articles
    News

    ESAs Issue Multiple Regulatory Updates for Financial Sector Entities

    The three European Supervisory Authorities (ESAs) issued a letter to inform about delay in the Sustainable Finance Disclosure Regulation (SFDR) mandate, along with a Call for Evidence on greenwashing practices.

    November 15, 2022 WebPage Regulatory News
    News

    FSB and NGFS Publish Initial Findings from Climate Scenario Analyses

    The Financial Stability Board (FSB) and the Network for Greening the Financial System (NGFS) published a joint report that outlines the initial findings from climate scenario analyses undertaken by financial authorities to assess climate-related financial risks.

    November 15, 2022 WebPage Regulatory News
    News

    FSB Issues Reports on NBFI and Liquidity in Government Bonds

    The Financial Stability Board (FSB) published a letter intended for the G20 leaders, highlighting the work that it will undertake under the Indian G20 Presidency in 2023 to strengthen resilience of the financial system.

    November 14, 2022 WebPage Regulatory News
    News

    ISSB Makes Announcements at COP27; IASB to Propose IFRS 9 Amendments

    The International Sustainability Standards Board (ISSB) of the IFRS Foundations made several announcements at COP27 and with respect to its work on the sustainability standards.

    November 10, 2022 WebPage Regulatory News
    News

    IOSCO Prioritizes Green Disclosures, Greenwashing, and Carbon Markets

    The International Organization for Securities Commissions (IOSCO), at COP27, outlined the regulatory priorities for sustainability disclosures, mitigation of greenwashing, and promotion of integrity in carbon markets.

    November 09, 2022 WebPage Regulatory News
    News

    EBA Finalizes Methodology for Stress Tests, Issues Other Updates

    The European Banking Authority (EBA) issued a statement in the context of COP27, clarified the operationalization of intermediate EU parent undertakings (IPUs) of third-country groups

    November 09, 2022 WebPage Regulatory News
    News

    EU Finalizes Rules Under Crowdfunding Service Providers Regulation

    The European Union has finalized and published, in the Official Journal of the European Union, a set of 13 Delegated and Implementing Regulations applicable to the European crowdfunding service providers.

    November 08, 2022 WebPage Regulatory News
    News

    OSFI Sets Out Work Priorities and Reporting Updates for Banks

    The Office of the Superintendent of Financial Institutions (OSFI) published an annual report on its activities, a report on forward-looking work.

    November 07, 2022 WebPage Regulatory News
    News

    APRA Finalizes Changes to Capital Framework, Issues Other Updates

    The Australian Prudential Regulation Authority (APRA) finalized amendments to the capital framework, announced a review of the prudential framework for groups.

    November 03, 2022 WebPage Regulatory News
    News

    BIS Hub and Central Banks Conduct CBDC and DeFI Pilots

    The Bank for International Settlements (BIS) Innovation Hubs and several central banks are working together on various central bank digital currency (CBDC) pilots.

    November 03, 2022 WebPage Regulatory News
    RESULTS 1 - 10 OF 8596