Global insurer systemic risk proposals stoke controversy

With the inaugural list of global systemically important insurers published, the insurance industry is troubled by the opaque decision-making process and a lack of guidance on how other firms can avoid being branded the same. Meanwhile, quickly evolving plans to develop a global capital backstop for insurers are also worrying some. Louie Woodall reports

Whether insurers pose a systemic risk to the financial sector and, if so, how this risk should be managed has been troubling politicians, policy-makers and regulators since the financial crisis.

At the end of July, the International Association of Insurance Supervisors (IAIS) and the Financial Stability Board (FSB) offered some answers to these questions, publishing a list of those insurance groups they deemed to be systemically important at a global level, as well as the additional policy