Insurance Core Principles and Methodology

Principles No. 1

INTERNATIONAL ASSOCIATION OF INSURANCE SUPERVISORS

INSURANCE CORE PRINCIPLES AND METHODOLOGY

October 2003

[This document was prepared by the Task Force on the Revisions to the Insurance Core Principles in consultation with members and observers.]

Insurance core principles and methodology

The Insurance core principles and methodology consist of – essential principles that need to be in place for a supervisory system to be effective – explanatory notes that set out the rationale underlying each principle – criteria to facilitate comprehensive and consistent assessments. This document should serve as a basic benchmark for insurance supervisors in all jurisdictions. It can be used when establishing a supervisory regime or for identifying areas in existing regimes that need to be improved. Public authorities concerned with issues of financial stability are urged to provide the necessary support to the supervisory authority so that it can meet the principles and the criteria set out herein.

Contents 1. 2. 3. Introduction ....................................................................................................................4 Conditions for effective insurance supervision .....................................................6

ICP 1 Conditions for effective insurance supervision ...........................................................6 The supervisory system ...............................................................................................8 ICP 2 Supervisory objectives .............................................................................................8 ICP 3 Supervisory authority...............................................................................................9 ICP 4 Supervisory process ...............................................................................................12 ICP 5 Supervisory cooperation and information...