G20 Meet

Today we cast an eye across the pond to the much anticipated Group of 20 meeting of heads of government. One point of discussion will be greater international coordination on financial regulation. The question is what is the likely impact for the global insurance sector? The Geneva Association has just released a letter signed by the CEOs of 49 major global insurers. In it the CEOs call for any future sector regulation to take into account the specific characteristics of the insurance business model, avoid pro-cyclical effects and to strike an appropriate balance between financial stability, consumer protection and a level competitive playing field. Specifically, they make the point that regulatory frameworks need to reflect the differences between insurers and banks. The CEOs also note the vital role insurers and reinsurers play in the global economy, accounting for 9 percent of GDP and with assets under management equaling 11 percent of the world total. Despite the financial crisis, insurance and reinsurance markets continue to operate normally, and their robust business model and risk management systems have enabled them to weather the crisis. Well said. Check out I.I.I. information on insurers’ contribution to the U.S. economy.

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