The Global Federation of Insurance Associations (GFIA), a group of 31 associations representing 87 percent of the insurance business globally and much of the U.S. industry, formally established an association and held its first meeting today in Washington, D.C, at the headquarters of the American Council of Life Insurers (ACLI).
Frank Swedlove, president of the Canadian Life and Health Insurance Association, serves as the newly-elected GFIA chair.
The first-ever such Federation was formed to represent the views of insurers from all over the globe to ensure a unified voice among all multi-national companies across all lines from health to life to property casualty lines before international panels like the International Association of Insurance Supervisors (IAIS). There is a slight precedent with the Geneva Association, which operates more like a think tank, and is very involved in reinsurance, risk management and demographic trends, and whose members are insurance CEOs themselves.
Members of the GFIA include, in addition to the ACLI, American Insurance Association (AIA), America’s Health Insurance Plans (AHIP), the Property Casualty Insurers Association of America (PCI) and the Reinsurance Association of America (RAA).
At the inaugural meeting, Swedlove and the group discussed a topic that is also front and center for the Geneva Association and for the Federal Insurance Office’s (FIO) Federal Advisory Committee on Insurance (FACI): Aging societies are challenging governments around the world. The amount of money and resources that will be needed to help keep people in dignity will strain nations’ finances, ACLI CEO Dirk Kempthorne said in the meeting.
The insurance industry will be relied upon to step in and help countries manage this problem – through its expertise in risk management and offering products that will help people receive income their entire lives, Kempthorne said.
“We are participating in GFIA to supplement our state, federal and international advocacy for open and competitive private insurance markets that are effectively and efficiently regulated. We have been approved to chair a GFIA working group on corporate governance,” said Dave Snyder, vice president, international policy for PCI.
The IAIS is having its annual meeting here in Washington this week. It is a critical time in the development of standards that will apply to companies worldwide, with implications for trade, company growth internationally, ratings, access, profitability, availability and affordability of insurance, the industry has said.
“This is a great day for the insurance industry around the world. The federation will give our associations the ability to respond on a timely basis to international issues affecting our industry and to speak with one voice,” Swedlove stated. “I am honored to have the opportunity to be the inaugural chair of the federation and will strive to ensure that our industry’s views are heard.”
The U.S. industry and others have weighed in on IAIS measures like standards for multinational insurers under the Common Framework (ComFrame) for the Supervision of Internationally Active Insurance Groups (IAIG) and the Global Systemically Important Insurers proposed assessment methodology(G-SII) with some concern about the consequences of imposing certain criteria across the board. Some nations do not even support the current ComFrame proposal to include companies that do business in three or more jurisdictions as the first basis on which to determine a company may qualify as an IAIG.
“In identifying a company as an IAIG, consideration should also be given to a company’s market share and its new business activity relative to other insurers in a particular jurisdiction,” Swedlove’s group, the Canadian Life & Health Insurance Association, has stated in its comments, for example.
The Canadian life insurance association said further, echoing to a great extent U.S. life and property casualty company views, “we respectfully suggest that the immediate focus of the ComFrame be … the establishment of effective coordination and cooperation between supervisors before turning to the question of what additional requirements might be appropriate for internationally active insurers which seems to be the thrust of Module 2 [one of the sections of the ComFrame draft].”
Welcoming the creation of the global federation, IAIS Executive Committee Chairman Peter Braumüller stated: “As the global insurance standard- setter, the IAIS values greatly the contributions of IAIS observers — who represent international institutions, professional associations and insurance and reinsurance companies — to the development and implementation of IAIS supervisory material. We look forward to working with GFIA and its members as we all continue to promote effective and globally-consistent supervision of the insurance industry.”
In alphabetical order, members are:
All Russian Insurance Association (ARIA)
American Council of Life Insurers (ACLI)
American Insurance Association (AIA)
America’s Health Insurance Plans (AHIP)
Association for Savings and Investment of South Africa (ASISA)
Association of Bermuda Insurers and Reinsurers (ABIR)
Association of British Insurers (ABI)
Association of Mutual Insurers and Insurance Cooperatives in Europe (AMICE)
Association of Spanish Insurers (UNESPA)