Insurance supervisors lukewarm about solving global programme mess |
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Reactions - Financial Interlligence for the Global Insurance Market 02 November 2010 European risk management associations may be best seeking a pan-European approach to sorting out the muddle over global insurance programmes because the IAIS does not seem keen to help, says Reactions' contributing editor Adrian Ladbury. In my last blog, the potential for a high level global initiative to try to clear up the muddle over global insurance programmes was discussed. It was concluded that the idea mooted by the European Captive Insurance and Reinsurance Owners’ Association (ECIROA) that the market should try to rise above ‘economic interest’ and tackle the big questions in a truly joined up way through the International Association of Insurance Supervisors (IAIS) was a laudable one. But at that point the IAIS had not responded to ECIROA’s call for a global initiative. Further, the response from many of the market players – particularly the big insurers that have invested a good deal of time and effort to help their customers feel more comfortable that their programmes are actually compliant – was decidedly lukewarm. It is after all their economic interest that is most under threat. The conclusion was that a market initiative to help spread core information on what companies need to do in as many territories as possible in order to achieve compliance would be perhaps a more feasible start point. The recent news that the London and International Insurance Brokers’ Association [LIIBA] has teamed up with TMF VAT & IPT Services, a company that specialises in tax compliance services for the insurance industry, to help its members calculate tax payable on insurance policies around the world on a territory-by-territory basis seemed like a good model. And, it is thought that Helen Hayden, risk manager at Prudential and a leading member of the That this may be the best route forward for the industry appeared to be confirmed recently during the European Captive Forum in Luxemburg as Sebastian von Dahlen of the IAIS gave a distinctly cautious response to questions about its willingness to support ECIROA’s idea. During a discussion during the event – organised by ECIROA, CICA and Captive Review newsletter – Praveen Sharma, Insurance Regulatory & Tax Consulting Leader at Marsh, asked Von Dahlen whether the IAIS would be willing to facilitate such an initiative. “Clients are confused because [insurers] have different views on the same issue. The industry needs to come together to give a consistent opinion. It is crying out for that and the IAIS has the potential to facilitate this,” said Sharma. But Von Dahlen did not sound too keen on the idea, though he did not rule it out entirely. “I would like to reconfirm that we are an association of insurance supervisors and therefore not involved in tax. But the IAIS does provide an opportunity for the sector to contribute topics of importance. At our annual conference we always have an open session focused on topics that have been submitted to the IAIS therefore there could be room for discussions,” he said. So it seems that if ECIROA really wants to make some progress on this big ugly topic then it will need to use its new status as a member of the IAIS and formally call for change to kick start the process. This looks like it will take a long time so perhaps, worried insurance buyers, brokers and even insurers had better start talking to their legal advisers sooner rather than later. |
