Fit for Global Thinking?
On 9-10 September 2014, EIOPA in cooperation with the International Centre for Insurance Regulation (ICIR), the World Bank and the Centre for the Study of Insurance Regulation at St. John’s University organised a third annual Conference on Global Insurance Supervision (GIS Conference).
The conference aimed at providing a platform for opinion exchange and discussions between supervisors, insurance industry and academia on an international level. The event took place in the Goethe University Frankfurt and attracted around 140 participants.
The GIS Conference 2014 was sub-titled “Fit for global thinking?” and its speakers and participants were encouraged to reflect on the creation, impact and enforcement of a global insurance regulatory framework.
The first day, 9 September, focused on three topics:
The impact of the low interest rate environment on insurance
The speakers indicated that the long lasting low interest rate environment resulted in the insurance business becoming unstable and conservative. It was indicated that in case low rates continue for longer time (a so-called “Japanese scenario”), insurance companies may be exposed to insolvency.
Global trends in risk-based supervision
This issue was discussed from both regulatory and industry prospective. It was indicated that there is a world-wide trend to move towards risk-based approaches and international harmonisation.
From the regulatory side, speakers presented examples of jurisdictions as Argentina, Brazil, China, Jordan, the EU, Mexico, Singapore, Thailand, Turkey, the U.S., where changes in different supervisory pillars have been made. Participants also called for strengthening group supervision. Regulators pointed at the number of challenges such as the lack of quality data and the importance of training or knowledge.
From the industry side, speakers warned about the risks of overregulation and called for a simple principles-based and efficient regulation and supervision that aims to facilitate problems rather than to prevent insurers from further developments.
Global standards: upcoming challenges in implementation
The topic was discussed in 4 sessions dedicated to the impact of global standards on existing regulatory frameworks; challenges for the industry in bridging the gap in order to comply with global standards; the ways of how global standards can cope with emerging risks as well as the necessity to ensure consistent application of global standards in the long-run.
The second day, 10 September, was dedicated to two issues:
Consumer protection as a new supervisory focus
It was emphasized that consumer protection has become part of the international agenda for insurance regulation and different countries have similar priorities with regard to this issue. Panellists spoke about the need to achieve higher transparency to be provided by the insurance industry and intermediaries; on products and costs; the supervisors’ duty to confront industry actions that are to the detriment of consumers and the importance of having in place product oversight as well as redress rules.
At the same time some participants emphasized that industry should see it as its duty to deliver high level services and protection to people; in particular, to help them to make informed decisions by effectively describing the products and presenting “documents that consumers will understand”.
Doing business in emerging markets: regulatory developments
Panellists discussed possible steps that regulators can make in order to improve insurance penetration in emerging markets. It was noted that companies entering such markets need to properly identify risks they will or might be facing and provide the right coverage for them. At the same time supervisory authorities in such countries were asked to consider already existing good practices, to engage in dialogue with new comers, to observe the proportionality principle and to bear in mind the costs of regulation.
If you have any queries regarding the GIS Conference, please contact the EIOPA Training & Events Team on +49 69 9511 1920 or email@example.com
NEW Room: Casino Anbau West Saal (next to the House of Finance).
Map to conference location