With the 2012 ComFrame draft, the International Association of Insurance Supervisors (IAIS) on 1 July 2012 presented a comprehensive version of the envisaged framework for the supervision of internationally active insurance groups (IAIGs). In the subsequent discussion and consultation, it became apparent that, although the industry was supporting the overall objectives of this endeavour, concerns have been raised in particular with regard to Module 2 of the 2012 ComFrame draft, dealing mainly with enterprise risk management and the assessment of the groups’ financial condition.

This paper seeks first and foremost to provide a more detailed understanding of the role, benefits and capabilities of the insurance industry, as well as an overview of the functioning of the insurance mechanism. It expounds upon the very real value that insurance offers individuals, institutions and the economy by providing a sense of security and peace of mind, encouraging loss mitigation, increasing prosperity, and generally making people more aware of the reality of risks and their consequences through information and pricing signals.

Core insurance business, due to its business model, is not as liquidity dependent as banking. Nevertheless, scenarios of liquidity problems in the insurance sector have been increasingly discussed among the regulatory and supervisory bodies. This analysis aims to further guide the discussion to help find the appropriate responses to potential liquidity risk.

Long-term care (LTC) systems all over the world rely heavily on provision of care by unpaid carers, mostly family members without specific training in this field. In several developed countries, the share of informal care provided to the elderly is estimated to amount to about three quarters of all long-term care provided, thus forming one of the most important building blocks of national care systems. Several international developments, however, raise concerns if and how this most important type of care provision will be able to retain its role.

Carriers providing long -term care (LTC) insurance have historically invested significant resources in risk management activities designed to ensure that policies are properly priced and that premiums can remain relatively stable for consumers. An important focus of such risk management activities has been the medical underwriting process and more specifically dementia screening. Dementia-related claims continue to present the single largest claim liability to LTC carriers.

This report examines the Equitable Life crisis and subsequent run-off as part of a series of case studies undertaken by The Geneva Association to identify the best practices for ensuring smooth, non-disruptive resolutions, with a focus on policyholder protection and the overall stability of financial markets and economies.

Four leading insurance climate change initiatives, whose combined membership includes more than a hundred of the world's leading insurers across Africa, Asia, Europe, North and South America, and Oceania, have combined their members' expertise to present this Statement.