The US National Association of Insurance Commissioners (NAIC) has said the decision to de-designate AIG as a Systemically Important Financial Institution (SIFI) means the International Association of Insurance Supervisors and the Financial Stability Board should look again at the process of identifying global systemically important insurers (G-SIIs).
AIG has been removed from the ‘too big to fail’ list maintained by the US and will therefore avoid additional supervisory requirements placed on firms deemed as SIFIs. The US Financial Stability Oversight Council (FSOC) said the insurer no longer poses a threat to financial stability in the US.
“The decision to de-designate AIG should factor into the international designation process for global systemically important insurers. When a US group is not considered systemic after a thorough domestic evaluation under FSOC, it is difficult to reconcile why it would remain systemic for international purposes,” said NAIC president-elect and Tennessee insurance commissioner Julie Mix McPeak. “This development highlights the need for a fresh and candid look at the G-SII process of the International Association of Insurance Supervisors and the Financial Stability Board.”
NAIC president and Wisconsin insurance commissioner Ted Nickel said: “AIG today is simply not the same company it was in 2008. I am pleased the Financial Stability Oversight Council finally recognised this with its recent decision to de-designate the firm. Going forward, we hope the FSOC will work more closely with state insurance regulators to identify any perceived risks impacting the insurance sector. We stand committed to addressing any concerns regarding such activity, where action is warranted.”
Full article on Commercial Risk (subscription required)
© Commercial Risk Europe
Key
Hover over the blue highlighted
text to view the acronym meaning
Hover
over these icons for more information
Comments:
No Comments for this Article