US insurance regulators have instructed an NAIC task force to examine options for a reform of the US rules on credit for reinsurance. The agreement was reached at the recent meeting of the National Association of Insurance Commissioners in Florida. The task force will be chaired by Julie Bowler, Massachusetts Insurance Commissioner.
While this does not signal an immediate change to the collateral requirements, it is seen as the first tangible sign from the US that the rules need to be changed.
Commenting on the announcement, Lloyd's Director of Worldwide Markets, Julian James said, “This is a very welcome step and we are encouraged that the US regulators have acknowledged formally the need to review the current laws.”
NAIC President Alessandro Iuppa, Insurance Superintendent for the State of Maine said the time had come for “some decision regarding collateral”, that it was time to move forward after five years of arguments and that he expected it to be the major workstream for the taskforce in the next 9 months.
