Daily Report for Executives provides in-depth coverage of unfolding legislative, regulatory, and judicial news from the nation’s capital, the states, and around the world. This daily news service...
By Brandon Ross
July 26 — Chinese insurance regulators echoed their American counterparts during a recent visit to the U.S., urging a go-slow approach in developing international insurance capital standards that would allow for jurisdictional control of implementation.
The officials of the fourth-largest insurance market sounded a lot like U.S. regulators, lawmakers and industry officials who have steadily pushed back against the International Association of Insurance Supervisors (IAIS) proposal for global insurance capital reserve requirements. U.S. officials have argued that those requirements are unfair to countries with insurance governance styles dissimilar to the European Union's Solvency II regulatory regime (See previous story, 06/08/16) (See previous story, 06/17/16).
The U.S. has long relied on a state-based approach to insurance regulation, whereas the Solvency II system is based a centralized-government methodology.
U.S. officials from the National Association of Insurance Commissioners (NAIC) and the New York State Department of Financial Services met July 26 with representatives from the China Insurance Regulatory Commission (CIRC) at NAIC's New York office.
The IAIS standards would, if implemented by various governments, establish new thresholds for the amount of capital that insurance companies have to hold on the side to cover potential failures of their holding companies or subsidiaries.
“The ongoing work at the IAIS to develop an Insurance Capital Standard must proceed at a measured pace and should be a standard which jurisdictions can implement to ensure it is truly global in nature,” Xiang Junbo, chairman of CIRC, said in a NAIC press release about the meeting.
Discourse between U.S. and Chinese regulators is especially important because China is a growing player in the world market, U.S. insurance industry officials said.
“Dialogue between insurance regulators from the United States and China is important for fostering regulatory environments that benefit both countries,” Steve Simchak, director of international affairs for the American Insurance Association told Bloomberg BNA in a July 26 e-mail. “China represents one of the world’s most significant emerging insurance markets.”
China is expected to become the world's second-largest insurance market within the next 10 years, the NAIC said in its release.
“We remain committed to working together in the spirit of consumer protection,” Junbo said.
The meeting follows a meeting that CIRC officials held last week with officials of the the U.S. Trade Representative, Commerce Department and the NAIC.
To contact the reporter on this story: Brandon Ross in Washington at firstname.lastname@example.org
To contact the editor responsible for this story: Heather Rothman at email@example.com
Copyright © 2016 The Bureau of National Affairs, Inc. All Rights Reserved.
All Bloomberg BNA treatises are available on standing order, which ensures you will always receive the most current edition of the book or supplement of the title you have ordered from Bloomberg BNA’s book division. As soon as a new supplement or edition is published (usually annually) for a title you’ve previously purchased and requested to be placed on standing order, we’ll ship it to you to review for 30 days without any obligation. During this period, you can either (a) honor the invoice and receive a 5% discount (in addition to any other discounts you may qualify for) off the then-current price of the update, plus shipping and handling or (b) return the book(s), in which case, your invoice will be cancelled upon receipt of the book(s). Call us for a prepaid UPS label for your return. It’s as simple and easy as that. Most importantly, standing orders mean you will never have to worry about the timeliness of the information you’re relying on. And, you may discontinue standing orders at any time by contacting us at 1.800.960.1220 or by sending an email to firstname.lastname@example.org.
Put me on standing order at a 5% discount off list price of all future updates, in addition to any other discounts I may quality for. (Returnable within 30 days.)
Notify me when updates are available (No standing order will be created).
This Bloomberg BNA report is available on standing order, which ensures you will all receive the latest edition. This report is updated annually and we will send you the latest edition once it has been published. By signing up for standing order you will never have to worry about the timeliness of the information you need. And, you may discontinue standing orders at any time by contacting us at 1.800.372.1033, option 5, or by sending us an email to email@example.com.
Put me on standing order
Notify me when new releases are available (no standing order will be created)