Issue 1136 / 18 November 2021

International Association of Insurance Supervisors

Diversity, equity and inclusion - IAIS publishes statement - 16 November 2021

The International Association of Insurance Supervisors (IAIS) has published a statement on ‘Diversity, Equity and Inclusion’ (DEI) in insurance supervision. This mirrors several strategic themes identified by the IAIS in its Strategic Plan 2020-2024.

The statement highlights the growing acknowledgment that advancing DEI within insurers’ organisations and business models supports sound prudential and consumer outcomes, and sustainability objectives.

The statement notes that DEI is particularly relevant to conduct and culture, as well as financial inclusion, sustainable economic development and technological innovation. The IAIS will deepen and strengthen its work relating to these themes through:

  • exploratory work on the insurance sector’s effects and steps taken by supervisors in support of DEI objectives, including via engagement with stakeholders;
  • incorporating relevant DEI aspects into ongoing IAIS projects and activities, in particular those related to corporate governance, culture and conduct; and
  • exploring opportunities to cooperate with other international organisations and partners to encourage supervisory dialogue and the sharing of good practices.

IAIS Statement: The importance of Diversity, Equity and Inclusion (DE&I) considerations in insurance supervision


Liquidity metrics - IAIS publishes Consultation Document - 18 November 2021

The IAIS has published a Consultation Document on Phase 2 of the development of liquidity metrics.

The IAIS split the development of liquidity metrics into two phases. Phase 1 (2020-21) focused on the development of an Insurance Liquidity Ratio (ILR) which uses an exposure approach (EA), as an ancillary indicator for the monitoring of liquidity risk. Phase 2 (2021-22) follows the November 2020 Phase 1 interim public consultation, and focuses on two approaches that the IAIS has developed to monitor liquidity risk: (i) the company projection approach; and (ii) the exposure approach including the ILR.

The liquidity metrics will assist the IAIS in monitoring the global insurance industry’s liquidity risk and its assessment of insurers’ liquidity exposure as part of its General Monitoring Exercise (GME) – a key element of the IAIS’ holistic framework for the assessment and mitigation of systemic risk in the global insurance sector. The liquidity metrics highlight potential vulnerabilities, risk drivers and trends of insurers and the insurance sector. The liquidity metrics are not intended to be a binding regulatory requirement, and are simply a monitoring tool.

The IAIS plans to finalise Phase 2 in 2022 and, as part of this, publish a report by November 2022. The IAIS notes it may decide to continue the liquidity metrics project to refine the calibration of the company projection approach / exposure approach beyond 2022.

The deadline for feedback is 23 January 2022 and a public background session will be held via webinar on 30 November 2021.

IAIS Consultation Paper: On the Development of Liquidity Metrics: Phase 2


Press release

European Commission

Solvency II - European Commission publishes Implementing Regulation for calculating technical provisions and basic own funds - 12 November 2021

The European Commission has published Commission Implementing Regulation (EU) 2021/1964 under the Solvency II Directive (2009/138/EC) (Solvency II).

The Regulation applies to the calculation of technical provisions and basic own funds with reference dates between 30 September 2021 to 20 December 2021. It aims to ensure uniform conditions for these calculations across insurance and reinsurance firms, which the Commission highlights is important for prudential reasons. The technical information covers: relevant risk-free-rate term structures; fundamental spreads for the calculation of the matching adjustment; and volatility adjustment for each relevant national insurance market.  

The Regulation will enter into force on the day following its publication in the Official Journal of the European Union.

Commission Implementing Regulation (EU) 2021/1964