Systemically important insurers: Global follows US lead

July 2013


On July 18th, the International Association of Insurance Supervisors (IAIS) published a methodology, endorsed by the Financial Stability Board (FSB), for identifying global systemically important insurers (G-SIIs) and a set of policy measures governing them. Using this assessment methodology, the FSB identified an initial list of nine G-SIIs, which includes three US firms.

This development follows the recent designations by the Financial Stability Oversight Council (Council) of AIG and Prudential as nonbank systemically important financial institutions (which Prudential is in the process of contesting), and the advancement of MetLife to the final stage of analysis before designation may be proposed (per MetLife's public disclosure).

The policy measures that will apply to G-SIIs include (i) recovery and resolution planning requirements, (ii) enhanced group-wide supervision and (iii) higher loss absorption requirements.

The key takeaways of this Financial Services Regulatory Brief are: the Council's view of which US insurers are G-SIIs has been mirrored at the FSB; their differing designation methodologies did not matter; the US G-SIIs will face more bank-centric requirements than their global competitors; and the US will continue to act first as necessary toward the next round of systemically important institution designations.

Contact us

Dan Ryan
US Banking and Capital Markets Leader
Tel: +1 (646) 471 8488

Alison Gilmore
US Asset and Wealth Management Marketing Leader
Tel: +1 (646) 471 0588