2012年-IMF国际货币组织全球_Israel_Detailed_Assessment_of_Observance_of_International_Association_of_Insurance_Supervisors_Insurance_Core_Principles_80页_1mb

Summary of Israel's Compliance with Insurance Core Principles

Core Content

This document provides a detailed assessment of Israel's observance of the Insurance Core Principles (ICPs) of the International Association of Insurance Supervisors (IAIS), conducted as part of the 2011 Financial Sector Assessment Program (FSAP) Update. The assessment was completed in March 2012 and reflects the regulatory and supervisory environment in place at that time. It highlights both the strengths and areas needing improvement in Israel's insurance sector.

Main Findings

• Compliance Level: Israel demonstrates a high degree of compliance with the ICPs. Of the 28 principles, 19 are assessed as observed, 6 as largely observed, and 3 as partly observed.
• Partly Observed Principles: These relate to consolidated supervision, cross-border supervision, and fraud prevention.
• Supervisory Framework: The Capital Markets, Insurance and Savings Division (CMISD) of the Ministry of Finance (MOF) is responsible for regulating and supervising the insurance sector.
• Regulatory Efforts: CMISD has made significant progress in implementing a modern framework for insurance supervision, including a risk-based approach and formal risk assessment processes.
• Operational Risk: The rapid pace of regulatory reforms, including the preparation for Solvency II and harmonization of long-term savings (LTS) supervision, has introduced some operational risk within the industry.
• Recommendations:
  • Strengthen supervisory cooperation and information sharing to attract foreign investors and support international expansion.
  • Improve group supervision by establishing formal policies on group capital adequacy, reinsurance, and risk concentration.
  • Enhance fraud prevention measures by requiring more effective actions from insurers to limit the costs of insurance claim fraud.
  • Consider amending the law to prohibit composite insurance structures and ensure clearer separation of business lines.
  • Increase transparency in the ownership structure of insurance agents and intermediaries.
  • Supplement supervisory staff with professionals experienced in operational risk management.

Market Overview

• Insurance Penetration: The Israeli insurance market, with total premiums of US$11.2 billion, has a penetration rate of around 5.3 percent of GDP in 2009, comparable to many OECD countries.
• Market Structure: The insurance market is dominated by a few large players, with the top five insurers accounting for 90 percent of the life insurance market and 63 percent of the non-life market.
• Composite Companies: Most insurers are composite companies, offering both life and non-life products. This structure raises concerns about the potential for cross-subsidization and legal challenges during insolvency.
• Non-Life Insurance: Non-life insurance accounts for about 50 percent of total premiums, with motor insurance making up approximately half of that. Growth in motor insurance has been relatively flat, while medical insurance has shown more significant growth.
• Asset Growth: As of June 30, 2011, the total assets under CMISD supervision reached NIS 958 billion. Life insurance assets have grown substantially, increasing from NIS 122 billion in 2005 to NIS 210 billion in 2010. Non-life insurance assets have grown at a slower rate, with an annual growth rate of 5.7 percent from 2008 to 2010.

Regulatory and Supervisory Environment

• Legal Framework: The main legal instruments governing the insurance sector are the Control of Financial Services (Insurance) Laws 5741-1981, along with other regulations and circulars.
• Reforms: The Bachar reform in 2005 led to the separation of non-commercial banking activities, contributing to the growth of the non-bank financial sector.
• Pension Reforms: In 2008, the Mandatory Pension Order was introduced, making pension provision compulsory for certain employees.
• Post-Crisis Developments: The financial crisis of 2008 had a significant impact on the Israeli economy, but the equity markets rebounded quickly. However, performance-based fee arrangements in the insurance sector were negatively affected, requiring a period of positive market performance to recover.
• Supervisory Initiatives: The CMISD has implemented several improvements, including enhanced information disclosure and transparency, and has been working to align its supervisory practices with international standards.

Key Challenges and Areas for Improvement

• Composite Structures: The dominance of composite insurers poses risks due to the potential for cross-subsidization and legal complications during liquidation.
• Cross-Border Supervision: There is a need for improved information sharing with foreign regulatory bodies to better manage cross-border risks.
• Fraud Management: While CMISD has addressed internal fraud, it needs to expand its efforts to include consumer fraud, which increases costs for the public.
• Operational Risk: The rapid implementation of new regulations and reforms may create operational challenges for insurers, requiring specialized supervisory expertise.

Conclusion

The Israeli insurance sector is generally compliant with the ICPs, with notable progress in transparency and risk management. However, there are areas requiring further attention, particularly in group supervision, cross-border cooperation, and fraud prevention. Continued efforts to align the regulatory framework with international best practices will be essential for the sector's long-term stability and development.