Collateral rules win NAIC vote

Financial strength proposal enters next stage of NAIC approval process

London market and European reinsures may have to wait until September 2007 to find out if a proposal to transform collateral requirements on US liabilities will be accepted by US regulators. A vote 155 in favor of a new system, replacing the current 100% collateral requirement with a sliding scale of collateral based on the financial strength rating of reinsures, was cast at the National Association of Insurance Commissioners’ (NAIC) winter meeting, moving the proposal further up the NAIC agenda.