CEA responds to US FSOC systemic risk consultation
25 February 2011
The CEA argues that FSOC’s proposed methodology for identifying systemic risk is not suitable for the insurance sector and instead puts forward a three-step approach to identifying the systemic risks presented to the IAIS by the insurance industry.
The CEA has commented on the latest proposals from the US Financial Stability Oversight Council (FSOC) for the supervision and regulation of certain non-bank financial companies. In its position paper in response to FSOC’s “Notice of Proposed Rulemaking Regarding Authority to Require Supervision and Regulation of Certain Non-bank Financial Companies,” the CEA reiterates its belief that core insurance business is not systemically risky.
It also argues that FSOC’s proposed methodology for identifying systemic risk is not suitable for the insurance sector and instead puts forward a three-step approach to identifying systemic risks that the insurance industry presented to the International Association of Insurance Supervisors (IAIS) earlier this month. The CEA further calls for no duplication of regulatory scrutiny for internationally operating companies that are already subject to robust home state group supervision.
The CEA also joins those calling for the FSOC rulemaking process to be delayed until it has the necessary insurance expertise in place and until the international debate on the identification of systemic risk is concluded.
Detailed information about the differences between the insurance and banking sectors as set out in the appendix to the position paper, is available in the CEA report “Insurance: a unique sector — Why insurers differ from banks.”
© CEA - Comité Européen des Assurances
