By Peter Braumuller
We are delighted to be in the Republic of Korea for our 18th Annual Conference and we are very grateful to our hosts, the Financial Services Commission (FSC) and the Financial Supervisory Service of Korea for organizing this important event. We also thank The Korea Times for putting together this special edition on the conference.
A key objective of the IAIS is to encourage broader information exchange and cooperation amongst insurance supervisors. Bringing so many different parties together at our Annual Conference is a part of this objective. The conference provides a unique opportunity to update all stakeholders on IAIS work as well as providing an additional forum for discussion on some of its major work streams.
The theme for the 2011 Annual Conference, ``Toward a New Horizon for Insurance Supervision: Cross-Sector and Cross-Border Harmonization and Cooperation,’’ neatly captures the flavor of some of the key work the IAIS has undertaken this year.
One important work stream is focused on the improvement of the supervision of internationally active insurance groups. Although a number of individual jurisdictions and regions have developed methodologies for group-wide supervision of insurance groups, there is currently no common framework that serves as a platform to supervise those groups globally.
The IAIS is addressing this through the development of the Common Framework for the Supervision of Internationally Active Insurance Groups (ComFrame).
The recent financial crisis highlighted the need for strengthening the resilience of the global financial system. Through its Financial Stability Committee the IAIS contributes to the Financial Stability Board’s efforts to address potential risks posed by insurers, which may be regarded as systemically important financial institutions.
These issues together with macro-prudential surveillance will be covered during three separate panels and we expect lively debates on these topics.
After three years of hard work and intensive discussion, the IAIS will adopt a revised set of Insurance Core Principles, standards and guidance (ICPs) at this year’s General Meeting in Seoul. We will discuss plans for implementation and implications of the new ICPs on supervision.
Standard setting is not a stand-alone exercise. In order to achieve high quality insurance supervision worldwide, implementation of the new principles and standards is crucial and challenging for all markets. A session will consider the importance of a proportionate response to insurance regulation in developing economies.
Insurance is a very dynamic industry with continual product innovation. Another panel will address risk management and product innovation. Ensuring policyholder protection and promoting appropriate market conduct is equally important. A panel will look at the challenges related to market conduct issues.
This year’s program also covers one of the biggest natural disasters of the year so far ― the devastating earthquake in Japan. We will hear how both the industry and supervisors respond to major catastrophes.
The interesting and varied conference program will be supplemented by two keynote speeches which will be given by Kim Seok-dong, chairman of the FSC and Masaaki Shirakawa, governor of the Bank of Japan and Vice-Chairman of the board of directors of the Bank for International Settlements.
Peter Braumuller is chairman of the International Association of Insurance Supervisors (IAIS) Executive Committee.