WASHINGTON (Nov. 14, 2019) – U.S. state insurance regulators today announced that Team USA members had secured an agreement advancing critical U.S. objectives as part of the International Association of Insurance Supervisor’s (IAIS) debate on the next phase of its Insurance Capital Standard (ICS) project. State regulator support came after the IAIS agreed to significant changes resulting in an achievable definition and approach to assessment of comparable outcomes, providing a clear path for the Aggregation Method. Other changes include providing timelines and governance for operationalizing the monitoring period, a commitment to consider modifications to the ICS itself, and conducting an economic impact assessment.
Members of Team USA have been clear that the pathway provided today ensures the Aggregation Method, as one part of a comprehensive U.S. regulatory framework, will be viewed through outcomes it provides and not simply a quantitative lens.
“While U.S. state regulators will not be implementing the ICS, we remain committed to an approach to group capital analysis which can and should be viewed as comparable to the outcomes achieved by the ICS," said Eric A. Cioppa, National Association of Insurance Commissioners (NAIC) President and Superintendent of the Maine Bureau of Insurance. "The substantial progress made by Team USA at the IAIS makes that possible."
U.S. state regulators' support at this interim stage in no way commits them to future adoption of the ICS, and as part of an iterative process, they will continue to assess future progress to ensure the ICS and the approach to comparability develops in a way that does not run counter to U.S. interests. While the IAIS will encourage Internationally Active Insurance Groups to participate in the monitoring period, as a non-binding standard setter it cannot mandate participation and ultimate decision-making rests with state group-wide supervisors.
“In coordination with the Federal Reserve and Treasury, we are committed to remaining actively engaged at the IAIS in the ICS project and all other work streams and are committed to advocate for, and only accept, those proposals that are in the best interest of U.S. consumers and insurers,” said Massachusetts Insurance Commissioner Gary Anderson. Anderson serves on the IAIS Executive Committee (ExCo) and as chair of the NAIC's International Insurance Relations (G) Committee.