Europe’s insurers support a principle-based approach to the organisational structures of control functions with a clear allocation of responsibilities. A national supervisor’s focus on an insurer’s corporate governance structures should also be risk-based and proportionate to the characteristics of each company. The IAIS paper should therefore acknowledge this more clearly.

Supervisors should focus primarily on outcomes, rather than individual elements. Furthermore, the IAIS paper puts an overly strong and siloed emphasis on concepts such as independence, the precise positioning of control functions in organisational structures and a rigid application of models, such as the three lines model.

The paper should explicitly refer to the contribution that risk management makes to achieving objectives and creating value, as well as to matters of “defence” and protecting value, rather than to defence alone. Moreover, the paper puts too strong an emphasis on how the design of a corporate governance framework can help insurers to avoid risks, while the focus should instead be on managing risks.