Toward a Global Approach to Regulating Insurers and Reinsurers

Abstract

One of the key lessons from the recent financial crisis is that regulations need to better reflect the globalization that has occurred in the financial sector in recent decades. The fragmented network of regulatory regimes that currently exists cannot cater to the international character of the large insurance and reinsurance companies that operate today. The insurance and reinsurance industry continues to face tremendous challenges in the years ahead. The ever-changing risk landscape, and regulators’ and shareholders’ demands for greater transparency, will require the industry to set forth its operations in ever more detail. A regulatory framework is required that instills and preserves confidence in the financial health of the industry, while accommodating its unique characteristics and global needs. As this article will explore, steps toward this global approach are underway, even if there is still a considerable distance to go.