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Business and Economics > Insurance

You are looking at 1 - 10 of 22 items for :

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  • Financial Institutions and Services: General x
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Cover IMF Staff Country Reports
Trinidad and Tobago: Technical Assistance Report-Strengthening Cybersecurity in Financial Institutions
International Monetary Fund. Monetary and Capital Markets Department
This technical note evaluates strengthening cybersecurity in financial institutions of Trinidad and Tobago. The deliverables included a capacity-building seminar on regulation of cyber risk. The Central Bank of Trinidad and Tobago identified the need for filling regulatory gaps and desires to issue a focused guideline on cybersecurity covering governance, risk management, incident reporting, and cyber hygiene, and intends to develop a draft guideline for consultation with its regulated institutions in the first quarter of 2023. Supervisory arrangements for Information and Communication Technology/cyber risks need further improvements and resource constraints within Financial Institutions Supervision Department need to be addressed urgently. The Identity and Access Management project has been formally set up and is now in Phase 1, which is considered preparatory. The governance of the project, the high-level roadmap, and the deliverables for Phase 1 are generally in line with good practices. It is recommended to establish regular cybersecurity meetings and reporting regime at the Board level with the participation of the Head of IT Security.
Keywords:
cybersecurity governance; Cybersecurity governance assessment; cybersecurity policy; control environment; pension firm; Cyber risk; Pensions; Insurance; Payment systems; Financial sector; Global
Cover IMF Staff Country Reports
France: Financial Sector Assessment Program-Technical Note-Issues in Insurance Supervision and Regulation
International Monetary Fund. Monetary and Capital Markets Department
This technical note focuses on issues in insurance supervision and regulation on France. France has a very high level of insurance penetration, particularly for life insurance. For each insurance company, a risk assessment is undertaken on at least an annual basis and is recorded in a supervisory review process tool. French insurance companies are significant users of the Volatility Adjustment (VA), with companies representing more than 90 percent of the technical provisions in the French insurance industry using the VA. The report discusses that French authorities should advocate to the relevant EU authorities to introduce a minimum number of independent members of the Administrative Management or Supervisory Boards, at least one-third. Autorité de Contrôle Prudentiel et de Résolution should review the intensity and frequency of on-site supervision and its relationship to off-site supervision. With several other meetings with insurance companies possible, some of these meetings may be close to be called as focused on-site inspections.
Keywords:
ISCR; CR; insurer; France; life insurance; insurance premium; life insurance insurance company; insurance market; industry representative; Solvency II; life insurer; parent bank; twenty-five solo insurance companies; SCR Ratios; Insurance companies; Insurance; Solvency; Liquidity risk; Financial conglomerates; Europe
Cover IMF Staff Country Reports
Australia: Financial Sector Assessment Program-Technical Note-Insurance Sector: Regulation and Supervision
International Monetary Fund. Monetary and Capital Markets Department
This technical note provides an update on the Australian insurance sector and an analysis of certain key aspects of the regulatory and supervisory regime. The note analyzes the practice in relation to selected Insurance Core Principles (ICPs) in the context of a wider discussion of key issues in regulation and supervision. Despite the negative impact of the low interest rate environment, the life insurance industry retains sufficient loss absorption capacity. The Australian Prudential Regulation Authority (APRA) has undertaken a comprehensive reform of prudential regulation while improving the consistency of the framework between life and general insurers. This focused review confirms that prudential regulation and supervision by APRA is reasonably conservative. The risk-based capital framework is reasonably conservative, which facilitates supervisory risk assessments. APRA has high technical capacity to conduct effective supervision. While there are some gaps in the regulatory regime, APRA seeks to address these through its supervisory process. The report recommends that APRA should expand and deepen its scrutiny of group activities, especially those entailing risky investments and material intragroup transactions.
Keywords:
ISCR; CR; APRA member; ASIC resource; risk management; ASIC commissioner; unit trust; ASIC IT infrastructure; enforcement power; ASIC capability; ASIC enforcement; APRA issues requirement; ASIC employee; ASIC enforcement review taskforce; data management system; Insurance companies; Insurance; Stress testing; Financial sector; Global
Cover IMF Working Papers
Cyber Risk, Market Failures, and Financial Stability
Emanuel Kopp
,
Lincoln Kaffenberger
, and
Christopher Wilson
Cyber-attacks on financial institutions and financial market infrastructures are becoming more common and more sophisticated. Risk awareness has been increasing, firms actively manage cyber risk and invest in cybersecurity, and to some extent transfer and pool their risks through cyber liability insurance policies. This paper considers the properties of cyber risk, discusses why the private market can fail to provide the socially optimal level of cybersecurity, and explore how systemic cyber risk interacts with other financial stability risks. Furthermore, this study examines the current regulatory frameworks and supervisory approaches, and identifies information asymmetries and other inefficiencies that hamper the detection and management of systemic cyber risk. The paper concludes discussing policy measures that can increase the resilience of the financial system to systemic cyber risk.
Keywords:
WP; financial system; economic risk; preferred risk profile; business model; firms visibility; Cyber risk; systemic risk; cyber insurance; cyber regulation; risk management; information asymmetries; market failure; financial services firm; liability insurance; firms' customer; market risk shock; cybersecurity provider; risk assessment; data loss; cybersecurity risk; customer notification; breach customer security; Operational risk; Insurance; Financial sector; Global
Cover IMF Staff Country Reports
Germany: Financial Sector Assessment Program-Insurance Sector Supervision-Technical Notes
International Monetary Fund. Monetary and Capital Markets Department
This paper provides an update on the German insurance sector and an analysis of certain key aspects of the regulatory and supervisory regime. It includes an analysis of German practice in relation to selected Insurance Core Principles in the context of a wider discussion of key issues in regulation and supervision. This technical note focuses mainly on recent developments in the sector and key vulnerabilities, including life insurance issues, those vulnerabilities associated with the continuing low interest rate environment; the preparations of the authorities and industry for the implementation of the Solvency II requirements; and the supervisory approach to large insurance groups.
Keywords:
ISCR; CR; Solvency II; insurance group; approach to group supervision; fixed income; parent company; supervisory view; ZZR requirement; Solvency II implementation; company level; business organization; reinsurance company; Solvency II requirement; companies' position; Solvency II SCR; a number of company; risk assessment; Insurance companies; Solvency; Insurance; Accounting standards; Global systemically important insurers; Global
Cover IMF Working Papers
Bailouts and Systemic Insurance
Mr. Giovanni Dell'Ariccia
and
Mr. Lev Ratnovski
We revisit the link between bailouts and bank risk taking. The expectation of government support to failing banks creates moral hazard—increases bank risk taking. However, when a bank’s success depends on both its effort and the overall stability of the banking system, a government’s commitment to shield banks from contagion may increase their incentives to invest prudently and so reduce bank risk taking. This systemic insurance effect will be relatively more important when bailout rents are low and the risk of contagion (upon a bank failure) is high. The optimal policy may then be not to try to avoid bailouts, but to make them “effective”: associated with lower rents.
Keywords:
WP; financial system; banking system; Bailouts; banking crises; moral hazard; systemic risk; contagion; bank resolution; bank risk taking; bank incentive; bank investment strategies; bank portfolio; bank monitoring; bank capital; bank shareholder; bank owner; Distressed institutions; Commercial banks; Bank credit; Insurance
Cover IMF Staff Country Reports
Belgium: Technical Note on Financial Conglomerate Supervision
International Monetary Fund. European Dept.
Belgian financial conglomerates (FCs) remained important players in the Belgian financial sector, despite significant restructuring following the global financial crisis. FCs operated in multiple streams of the financial sector, especially in banking and insurance. Owing to their economic reach and use of regulated and unregulated entities across sectoral boundaries, FCs presented a challenge for sector-specific supervisory oversight. The Executive Board suggested a pragmatic supervisory approach, which needs to be streamlined and applied more uniformly to contain FC-specific risks.
Keywords:
ISCR; CR; parent company; risk management; group transaction; risk concentration; risk profile; FC supervision; supervisory framework; FC legislation; NBB expectation; FCS draw; group level; bancassurance group; group risk; Insurance companies; Capital adequacy requirements; Insurance; Financial conglomerates; Financial sector; Global
Cover IMF Staff Country Reports
Malaysia: Financial Sector Stability Assessment
International Monetary Fund. Asia and Pacific Dept
This assessment is a review of the financial environment of Malaysia. Like many other Asian countries, Malaysia experienced financial distress in the late 1990s, but the country’s policy reforms have moved it to a successful economy. A ten-year financial plan (2001–10) by Bank Negara Malaysia restructured the financial sector. Banks were well capitalized, household debts were strengthened, and securities and insurances were developed. Malaysia thus became the global center for Islamic finance. The authorities look on to a developed Malaysia by 2020.
Keywords:
ISCR; CR; credit risk; financial system; capital adequacy ratio; foreign exchange; banking system; BNM securities; interest rate; bank resolution framework; bank lending; BNM data; monetary policy framework; exchange rate; Commercial banks; Insurance companies; Financial sector; Insurance; Global; Asia and Pacific
Cover IMF Working Papers
Barriers to Household Risk Management: Evidence from India
Robert M. Townsend
,
Ms. Shawn Cole
,
Mr. Jeremy Tobacman
,
Mr. Xavier Gine
,
Mr. James Ian Vickery
, and
Petia Topalova
Why do many households remain exposed to large exogenous sources of non-systematic income risk? We use a series of randomized field experiments in rural India to test the importance of price and non-price factors in the adoption of an innovative rainfall insurance product. Demand is significantly price sensitive, but widespread take-up would not be achieved even if the product offered a payout ratio comparable to U.S. insurance contracts. We present evidence suggesting that lack of trust, liquidity constraints and limited salience are significant non-price frictions that constrain demand. We suggest contract design improvements to mitigate these frictions.
Keywords:
WP; Gujarat video experiment; product endorsement; financial product; insurance demand; expected return; Gujarat video treatment; payout slope; product diffusion; Insurance; Household Finance; Trust; Liquidity Constraints; Economic Development; Andhra Pradesh sample; Insurance companies; Consumption; Liquidity; Africa
Cover IMF Staff Country Reports
Kingdom of the Netherlands-Netherlands: Publication of Financial Sector Assessment Program Documentation: Detailed Assessment of Observance on Insurance Core Principles
International Monetary Fund
Significant legislative changes and regulatory developments have taken place in the Netherland’s insurance sector. The initial Financial Sector Assessment Program (FSAP) and the current assessment are benchmarked against the Insurance Core Principles (ICPs) issued in 2003. Progress has been made in addressing the recommendations arising from the assessment. The Financial Institutions Risk Analysis Method (FIRM) and the introduction of macroprudential supervision have strengthened The NetherlandsCentral bank's (DNB) risk-based supervision and market analysis. The updated regulatory framework has a high level of observance and the government has strengthened macro-prudential supervision to complement the traditional supervision approach.
Keywords:
ISCR; CR; life insurer; risk management; corporate governance; financial market; reinsurance broker; holding company; insurance group; insurance supervision; DNB staff; AFM official; Netherlands insurer; risk profile; registering insurance intermediary; risk assessment; outsourced activity; Insurance companies; Insurance; Solvency; Legal support in revenue administration; Financial conglomerates; Global