Senate Banking Committee Issues Testimony From Treasury Director Seitz
"Thank you for the opportunity to testify today about developments in global insurance regulatory and supervisory forums. My name is
"FIO serves as a source of insurance expertise in the federal government. Among its other statutory authorities and responsibilities, FIO: provides advice to the Treasury Secretary on major domestic and prudential international insurance policy issues; represents
"As you know, the
International Supervisory Forums
"Turning to FIO's international engagement, as
"Before proceeding with comments regarding our engagement internationally, I would like to touch on efforts to promote transparency at the IAIS. As noted in our
"Domestically,
"
"With that background, I'll turn to a discussion of the IAIS, which is the international standard-setting body responsible for developing, and assisting in the implementation of, principles, standards, and other supporting material for supervision of the insurance sector.3 The mission of the IAIS is to promote globally consistent insurance supervision in order to maintain safe insurance markets for the benefit of policyholders, and to contribute to global financial stability. IAIS members include insurance authorities from more than 200 jurisdictions.4
"FIO has advocated for changes to the IAIS governance structure so that
"
"Additionally, in 2009, the G-20 recognized the importance of international cooperation when it established the Financial Stability Board (FSB) to coordinate the work of the international standard setting bodies and promote the implementation of effective regulatory, supervisory, and other financial sector policies.
"It is important to note that international standards are not, in and of themselves, binding in
"Let me now turn to some of the ongoing work at the IAIS, and the related positions and activities of
IAIS Initiatives
"In accordance with the Economic Growth, Regulatory Relief, and Consumer Protection Act,
a. Insurance Capital Standard
"In
"Since 2015, the IAIS has conducted annual field testing of volunteer insurers, including
"
* First,
* Second,
* Third, it is important that the IAIS strengthen its efforts to develop a final ICS that is implementable in
* Finally, getting the ICS right at the IAIS is more important than meeting any fixed schedule that mandates completion of the ICS at a specific point in time.
b. Holistic Framework
"Another important international standard-setting initiative is the IAIS's proposed framework for assessing and mitigating systemic risk in the insurance sector (also known as the activities-based approach, or ABA). In 2017, the IAIS began work on the ABA, and in
"In
"
"Thank you again for the opportunity to testify today, and I look forward to your questions."
* * *
Footnotes:
1 See Treasury and
2 IAIS, 2020-2024 The IAIS Strategic Plan, at 6, (
3 See IAIS, 2017 IAIS Annual Report, at 8 (2018), https://www.iaisweb.org/page/about-the-iais/annual-report//file/77857/iais-ar-2017-digital-pdf-def-dp. See also FIO, Annual Report on the Insurance Industry, at 36-37 (
4 IAIS, 2017 IAIS Annual Report, at 8.
5
6 See Treasury and
7 FSB, Global systemically important insurers (G-SIIs) and the policy measures that will apply to them, at 2 (
8 IAIS, Risk-Based Global Insurance Capital Standard Version 2.0: Public Consultation Document (
9 IAIS, Implementation of ICS Version 2.0 (
10 IAIS, Risk-based Global Insurance Capital Standard Version 2.0.
11 IAIS, Holistic Framework for Systemic Risk in the Insurance Sector: Public Consultation Document (
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