IAIS published the October issue of its newsletter. This issue highlighted that IAIS completed its first assessment under the new Peer Review Process. The first Peer Review Process focused on the mandate for supervisors and supervisory powers, which includes Insurance Core Principles, or ICPs, 1 (Objectives, Powers, and Responsibilities of the Supervisor) and 2 (Supervisor). The Expert Team will present its final report in November and the report will cover a synthesis of useful practices for standards where observance can present challenges.
The IAIS Secretary General highlighted that much of the focus is on finalizing key aspects of post-crisis reforms; however, IAIS will continue to look to the horizon by expanding the efforts to respond proactively to the emerging trends that are fundamentally shifting the landscape of the insurance sector. This was evidenced in a recent collaboration between IAIS and the FSB Financial Innovation Network, at a workshop on "Data and innovation—Opportunities and risks for the insurance sector." The workshop addressed implications of new and big data, artificial intelligence, and machine learning for policyholders and broader society; innovative business models in insurance; third-party outsourcing; and financial stability, regulatory, and supervisory issues. The newsletter also notes that the Fintech Forum met on October 21 to discuss developments in the use of artificial intelligence in the insurance sector and related supervisory issues.
Additional key developments during the month included the following:
- The Executive Committee met on October 10 to agree on feedback to be provided to FSB on certain operational aspects of the holistic framework for systemic risk in the insurance sector. In addition, the Committee met on October 23-24 in London. Agenda items included a discussions on various documents related to the finalization of the holistic framework and on issues related to the development of the Insurance Capital Standard (ICS) Version 2.0 for the monitoring period.
- The Macro-prudential Committee met on October 18 to discuss various documents related to the finalization of the holistic framework for systemic risk in the insurance sector.
- The Policy Development Committee met on October 21 to discuss issues related to development of ICS Version 2.0 for the monitoring period.
- The Accounting and Auditing Working Group (AAWG) met on September 23-24 and finalized a comment letter to IASB on the Exposure Draft on amendments to IFRS 17 on insurance contracts. The AAWG continues to monitor adoption and implementation activities of IFRS 17.
Keywords: International, Insurance, Newsletter, IFRS 17, Systemic Risk, ComFrame, ICS Version 2.0, ICPs, Fintech, Insurance Contracts, FSB, IAIS
PRA proposed rules (in CP12/21) for the application of existing consolidated prudential requirements to financial holding companies and mixed financial holding companies that have been approved or designated in accordance with Part 12B of the Financial Services and Markets Act 2000 (FSMA).
ECB Banking Supervision announced that euro area banks it directly supervises may continue to exclude certain central bank exposures from the leverage ratio until March 2022.
OSFI decided to increase the Domestic Stability Buffer from 1.00% to 2.50% of total risk-weighted assets, with effect from October 31, 2021.
HKMA is requesting banks to participate in a tech baseline assessment, which forms part of the HKMA Fintech 2025 strategy.
OSFI published two documents to consult on the management of operational risk capital data for institutions required, or for those applying, to use the Basel III standardized approach for operational risk capital in Canada.
The NGFS Study Group on Biodiversity and Financial Stability published a Vision paper exploring the case for action in addressing the financial stability concerns arising from biodiversity loss.
ACPR published the final version of CREDITIMMO 2.3.0 taxonomy for the decree of October 31, 2021.
EC, has approved, under the EU State Aid rules, the fourth prolongation of the Italian guarantee scheme to facilitate the securitization of non-performing loans.
ECB published Guideline 2021/975, which amends Guideline ECB/2014/31, on the additional temporary measures relating to Eurosystem refinancing operations and eligibility of collateral.
EIOPA published a report, from the Consultative Expert Group on Digital Ethics, that sets out artificial intelligence governance principles for an ethical and trustworthy artificial intelligence in the insurance sector in EU.