NAIC collateral review enters final stages

The Reinsurance Task Force charged with finding an alternative to the 100% collateral rule for foreign reinsurers in the US said it would take on board an industry proposal to replace the current system. Hosting a meeting between 8 & 9 September as part of the National Association of Insurance Commissioners’ (NAIC) national Fall conference, the Reinsurance Task Force said the group of reinsurers, ceding insurers, trade associations and lawyers that make up the Interested Parties Group, established to advise the committee, presented its proposal for a rating-based approach that would essentially use the financial strength ratings of reinsurers to set a sliding scale of collateral requirements, with lower requirements placed on reinsurers with higher ratings.