2016年-FSB全球金融稳定委员会_Developing_Effective_Resolution_Strategies_and_Plans_for_Systemically_Important_Insurers_24页_351kb

Summary of "Developing Effective Resolution Strategies and Plans for Systemically Important Insurers"

Core Content

This document provides guidance on the development of effective resolution strategies and plans for systemically important insurers (SIIs), particularly global systemically important insurers (G-SIIs), in accordance with the FSB Key Attributes of Effective Resolution Regimes for Financial Institutions (Key Attributes or KAs). The guidance aims to ensure that resolution strategies are designed to maintain financial stability, protect policyholders, and avoid severe systemic disruption or taxpayer loss.

Main Objectives of Resolution Strategies

• Feasibility of resolution: Ensure that an insurer can be resolved without causing severe disruption to the financial system.
• Protection of policyholders: Prioritize the protection of policyholders, beneficiaries, and claimants.
• Loss absorption: Allow for the absorption of losses by shareholders and unsecured creditors.
• Operational continuity: Maintain the continuity of critical business operations and functions during resolution.

Determination of a Preferred Strategy

Resolution strategies should be tailored to the specific structure and business model of the insurer, considering:

• The structure of the insurance group (e.g., operating entities (opco) or holding companies (topco)).
• The availability and coverage of policyholder protection schemes (PPS).
• The nature of the failure (e.g., solvency or liquidity issues).
• The degree of internal interconnectedness within the group.

Points of Entry into Resolution

1. Entry at the opco level: Applicable for insurers with limited internal interdependencies and where shared services are separate and funded. Common in groups with local subsidiaries and limited intra-group transactions.
2. Entry at the topco level: Applicable for groups with centralized capital and liquidity, systematic intra-group support, and shared services. Often used to preserve group structure and diversification benefits.

Preferred Resolution Tools

Resolution tools are categorized based on their objectives:

1. Stabilisation and Restructuring Tools

• Sale or transfer of shares to a third party or bridge institution.
• Sale or transfer of insurance portfolios or business to third parties or bridge institutions.
• Creditor-financed recapitalisation, including restructuring liabilities and converting them into equity.

2. Tools for Orderly Run-off

• Solvent run-off: Transfer existing business to other insurers, with possible recapitalisation.
• Insolvent run-off: Managed run-off of claims without writing new business, respecting the creditor hierarchy.

3. Stay and Suspension Powers

• Temporarily suspend early termination rights or surrender rights to allow time for restructuring.
• Prevent mass closeouts of financial contracts, especially derivatives, to preserve value.
• Avoid disruption of critical shared services or financial market infrastructures (FMI).

Strategic Analysis for Resolution Planning

Resolution strategies must consider:

• Business segments: Life insurance, property and casualty (P&C), reinsurance, and financial market activities.
• Critical functions: Defined as those that are essential to third parties, have significant systemic impact, and cannot be substituted quickly or at reasonable cost.
• Operational continuity: Identify and protect critical shared services that support insurance operations.
• Cross-border cooperation: Establish cooperation agreements (COAGs) among home and host authorities to coordinate resolution efforts.
• Funding and liquidity: Ensure that resolution plans account for capital needs and liquidity risks, especially in cases of insolvency.
• Policyholder protection schemes (PPS): Leverage PPS to support the transfer of policies or compensate policyholders during run-off.

Making the Resolution Strategy Operational

Authorities should develop operational resolution plans that:

• Outline specific actions to implement the resolution strategy.
• Consider failure scenarios and the timing for triggering resolution.
• Include cooperation agreements among relevant authorities.
• Specify information systems and data requirements to support resolution planning.
• Plan for exit strategies to ensure smooth transition from resolution to a stable state.

Key Considerations

• Resolution strategies must be periodically reviewed and modified to reflect changes in the legal and business environment.
• Resolvability assessments are essential to identify potential barriers and improve the feasibility of resolution.
• Bridge institutions may be used to facilitate the transfer of insurance business and maintain continuity.
• Temporary stays on contractual rights are important to prevent premature termination of critical services and financial contracts.
• Interconnectedness within insurance groups, while generally lower than in banking groups, can still pose resolution challenges.
• PPS play a vital role in protecting policyholders and supporting resolution actions, especially in cases of insolvency.

Conclusion

This guidance emphasizes the importance of tailored resolution strategies that account for the unique structure, business model, and operations of SIIs. It underscores the need for cooperation across borders, effective use of resolution tools, and continuous monitoring and improvement of resolution plans to ensure they remain credible and operational in the face of potential failures.