Edited by Iwan J. Azis and Hyun S. Shin
Chapter 17: Global financial regulatory trends and challenges for the development of the insurance and pensions sector in the Asia-Pacific region
The 2008–09 global financial crisis has prompted wide-ranging regulatory reforms to be undertaken by the international community to strengthen the resilience of the global financial sector. Some of the activities of the insurance and private pensions sector, which was relatively less affected by the crisis than other financial sectors, under certain conditions have the potential to be systemically relevant if conducted on a huge scale and with poor risk governance and supervisory oversight. Such non-core activities are closer to quasi-banking and include speculative derivatives trading on non-insurance firm balance sheets and the mismanagement of short-term funding. Therefore, the insurance industry can be considered systemically important. The regulatory reforms that have been unleashed are a part of important initiatives to reformulate the future landscape for finance, including the IAIS’s Insurance Core Principles (IAIS 2011a), the EU’s Solvency II Directive, and Basel III capital adequacy requirements. The identification of global systemically important insurers (G-SIIs) and the supervision of internationally active insurance groups (IAIGs) is also likely to place additional demands on regulators to address sub-optimal supervisory structures and prudential issues such as enhanced risk-based capital frameworks, and place greater regulatory focus on policyholder compensation schemes, group-wide supervision, and more coordinated resolution mechanisms.
You are not authenticated to view the full text of this chapter or article.
Elgaronline requires a subscription or purchase to access the full text of books or journals. Please login through your library system or with your personal username and password on the homepage.
Non-subscribers can freely search the site, view abstracts/ extracts and download selected front matter and introductory chapters for personal use.
Your library may not have purchased all subject areas. If you are authenticated and think you should have access to this title, please contact your librarian.