Insurance Core Principles

Last Updated: 8/25/2023

The Insurance Core Principles (ICPs) developed by the International Association of Insurance Supervisors (IAIS) provide a globally accepted framework of principles, standards, and guidance for the regulation and supervision of the insurance sector. The IAIS was established in 1994 to promote cooperation among insurance supervisors around the globe and with supervisors in other financial sectors and includes as members insurance regulators and supervisors of more than 200 jurisdictions in nearly 140 countries.

Overview: The IAIS ICPs set out the fundamentals of effective insurance supervision. They serve as a basic benchmark for insurance supervisors in all jurisdictions and can be used when establishing a supervisory regime or for identifying areas in existing regimes that need to be improved. They are intended to be flexible enough to apply to the variety of insurance supervisory regimes, regardless of maturity, as well as to both insurance legal entities and insurance groups. They apply to the supervision of insurers whether private or government-controlled insurers that compete with private enterprises, wherever their business is conducted, including through e-commerce.

The ICP material is presented in order that the hierarchy can be clearly understood. Principle statements, at the highest level in the hierarchy, describe the essential elements of a supervisory regime to promote a well-functioning insurance sector. Standards set out the key, high level requirements for successfully implementing the principle statements. Standards must be met to demonstrate full observance of the related principle statement. Guidance material, the lowest level in the hierarchy, elaborates on the meaning of or provides examples of possible ways to implement a principle statement or standard.

The ICPs are used in the evaluation of supervisory regimes under the Financial Sector Assessment Program (FSAP) conducted jointly by the World Bank and the International Monetary Fund (IMF). The FSAP is a comprehensive and in-depth analysis of a country's financial regulatory sector. The World Bank and the IMF rely on internationally recognized standards as a way to measure observance with accepted practices. For insurance, the ICPs form the basis for the assessment of insurance regulators' observance of international standards. 

The ICPs were first issued in 1997 and a revised set of 26 principles was adopted in 2011 drawing on lessons learned from the financial crisis, including recommendations from the Financial Stability Board, experience gained from FSAP assessments, as well as evolving supervisory practices and changes in the insurance sector. 

When adopting the 2011 set of ICPs, the IAIS recognized the need to not only set international standards, but also promote their implementation among its member jurisdictions. The IAIS Implementation and Assessment Committee is charged with assessing and reviewing the implementation of the ICPs by IAIS members and to identify potential areas for improvement to ensure that the ICPs continue to represent a solid basis for insurance supervision. The IAIS assessment program includes the Peer Review Process, which relies on self-assessment questionnaires; the Self-Assessment Portal, where IAIS members can access on-demand online assessments and receive feedback immediately; and the Member Assessment Process, which incorporates an on-site review similar to an FSAP. 

The IAIS most recently adopted an updated set of ICPs in November 2019. Additionally, the Common Framework for the Supervision of Internationally Active Insurance Groups (ComFrame) was adopted in November 2019 and has been integrated for presentation purposes within the relevant ICPs since its implementation by IAIS members in 2020.