Page 133 - CFPA-SCR-Award in General Insurance W01_2018-19_Neat

Chapter 9 Insurance regulation 9/5

6. Conflicts of interest Insurers and intermediaries should avoid conflicts of interest.
7. Relationship with regulators Insurers and intermediaries should deal with their regulators in an
open and cooperative way.
8. Complaints Insurers and intermediaries should support a system of complaints
handling where applicable.
9. Management and control Insurers and intermediaries should organise and control their affairs
effectively.
10. Market conduct Insurers and intermediaries should observe proper standards of
market conduct.
11. Clients’ assets Insurers and intermediaries must arrange adequate protection for
clients’ assets when they are responsible for them, not just their own
(all regulators) regulators in other jurisdictions.

A3 Regulators’ supervisory tools

Regulators can use a wide range of supervisory tools. These can be broadly summarised as diagnostic
(used to identify and monitor risks) and remedial (used to mitigate risks and remedy shortcomings).

A3A Diagnostic tools
Diagnostic tools seek to identify problems at an early stage and allow regulators to engage with the
company before these problems become a serious threat to their supervisory objectives. To learn more
about the company’s businesses and risk management practices, regulators may need to ask them for
more information; there may be information gaps or there may have been substantial change in their
activities, for example.

A3B Remedial tools
Remedial tools will in many cases require the company to take action and work with the regulators to
achieve a specific outcome. For instance, in an inspection the regulator may come across certain weak
controls and governance practices, which they will then require the company to remedy and
subsequently provide progress reports on the remedial actions taken.

B International Association of Insurance
Supervisors (IAIS)

The International Association of Insurance Supervisors (IAIS) was established in 1994 to promote
cooperation between insurance supervisors and other financial sector supervisors.
The IAIS represents the insurance regulators and supervisors of more than 200 jurisdictions in nearly 140
countries. Since 1999, the IAIS has also welcomed insurance professionals as observers and currently
there are more than 130 observers representing industry associations, professional associations,
insurers and reinsurers, consultants and international financial companies.
The IAIS issues global insurance core principles, provides training and support on issues related to
insurance supervision, and organises meetings and seminars for insurance supervisors.
The IAIS coordinates its work with other international financial policymakers and associations of Chapter
supervisors or regulators, and assists in shaping financial systems globally. In particular, the IAIS is a
member of the Financial Stability Board (FSB), member of the Standards Advisory Council of the 9
International Accounting Standards Board (IASB) and partner in the Access to Insurance Initiative (A2ii).
In recognition of its collective expertise, the IAIS also is routinely called upon by the G20 leaders and
other international standard setting bodies for input on insurance issues as well as on issues related to
the regulation and supervision of the global financial sector.
An Executive Committee, whose members represent different geographical regions, heads the IAIS. It is
supported by three main committees – the Technical Committee, the Implementation Committee and the
Budget Committee.
These committees form sub-committees and working parties to accomplish their objectives.