LONDON, July 9 Regulators published on Wednesday
details of how the world's top nine insurers will calculate
their first global capital buffer from 2019 to ensure
policyholders are protected in a crisis.
The International Association of Insurance Supervisors
(IAIS) was issuing a second round public consultation on its
plan for a basic capital requirement, or BCR.
Leaders of the Group of 20 economies (G20) have called for
this measure in the teeth of opposition from insurers, who say
the 2007-09 financial crisis which has sparked a flurry of new
regulation was not caused by their sector.
Axa, Generali, MetLife and Aviva
are among the nine so-called global systemically
important insurers who will be affected.
But exactly how much extra capital they may need to hold
will also depend on the size of an additional safety buffer,
made up of bonds, that will not be fleshed out by the IAIS until
2015 or later.
The watchdog proposed in its consultation to give each type
of insurance activity specific weightings which are totted up to
calculate the BCR. Assets like shares have a higher weighting
than less risky mortgage insurance.
In total, 15 factors will be considered within three key
categories of insurance activities: traditional life insurance,
non-life insurance and non-traditional insurance and assets.
The IAIS will publish its final BCR rule in time for a G20
summit to endorse in Brisbane, Australia, in November.
That month the regulators will also review their list of top
insurers that could see re-insurers being included for the first
(Reporting by Huw Jones; Editing by Mark Heinrich)