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Common Framework for the Supervision of Internationally Active Insurance Groups (ComFrame)

Last Updated 5/15/20

Issue: The regulation of insurance groups garnered considerable attention following the global financial crisis of 2008, with various regulatory agencies developing new guidelines and requirements for the supervision of financial holding companies. In the U.S., the Solvency Modernization Initiative (SMI), initiated in June 2008, led to substantive changes regarding how insurance groups are monitored and regulated, including amendments to the Insurance Holding Company System Regulatory Act (#440) and the Insurance Holding Company System Model Regulation (#450). Globally, the most significant development regarding group supervision is the Common Framework for the Supervision of Internationally Active Insurance Groups (ComFrame), developed by the International Association of Insurance supervisors (IAIS). As part of ComFrame, the IAIS is also developing a global, risk-based insurance capital standard (ICS).

Overview: ComFrame was initiated in recognition of the growing relevance of IAIGs in the global insurance marketplace and the need for an internationally coherent framework for the supervision of large, complex, global insurance groups. The IAIS began developing ComFrame in July 2010 to build on individual member efforts to improve group supervision and provide better insights to supervisors on how IAIGs operate.

ComFrame provides a set of international standards focusing on the effective group-wide supervision of internationally active insurance groups (IAIGs). ComFrame sets out a comprehensive range of quantitative and qualitative standards and guidance tailored to the international activity and size of IAIGs. ComFrame is built and expands upon the high level standards and guidance currently set out in the IAIS Insurance Core Principles (ICPs), which generally apply on both a legal entity and group-wide level. To provide better context for ComFrame with respect to the ICPs, ComFrame material is presented under the relevant ICPs.

In October 2013 the IAIS announced the development of the ICS, which aims to provide a comparable measure of capital across jurisdictions that will help allow for a common understanding of IAIG capital adequacy, enhancing cooperation and coordination among supervisors. The ICS is being developed as a group-wide, consolidated insurance capital standard; it does not replace existing requirements for insurance legal entity supervision in any jurisdiction.

Once adopted, the ICS will apply to IAIGs as part of ComFrame. In November 2017, the IAIS announced details on how ICS Version 2.0 will be implemented. The first phase consists of a 5-year monitoring period during which a reference ICS will be used for confidential reporting to group-wide supervisors and discussion in supervisory colleges, and additional reporting collected at the option of the group-wide supervisor, including ICS based on a GAAP Plus valuation approach and/or an internal model-based capital requirement calculation. The second phase will be implementation of the ICS as a group-wide prescribed capital requirement (PCR).

As part of this ongoing work, the IAIS has recognized the U.S. work on an aggregation approach and will assess by the end of the monitoring period whether such an approach reaches comparable outcomes to the ICS. During the monitoring period, the IAIS will continue to collect data from interested jurisdictions relevant to the development of the Aggregation Method. In November 2019, the IAIS established a timeline and workplan for assessing comparable outcomes as well as work related to improvement of the ICS.

Status: ComFrame, including ICS Version 2.0 for the monitoring period, was adopted in November 2019 and is being implemented by IAIS members in 2020.

As part of its 2020 charges, the Group Solvency Issues (E) Working Group will assess ComFrame and make recommendations on its implementation in a manner appropriate for the United States. 

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Media queries should be directed to the NAIC Communications Division at 816-783-8909 or

Ryan Workman
Assistant Director, International Relations and Policy  

NAIC Center for Insurance Policy and Research (CIPR)

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