New risk based capital framework for insurers in Singapore has been saved
New risk based capital framework for insurers in Singapore
Challenges and opportunities
The Risk-Based Capital (RBC) framework for insurance companies was first introduced in Singapore in 2004. It adopts a risk-focused approach to assessing capital adequacy and seeks to reflect the relevant risks that insurance companies face. In order to align the framework with international standards and best practice, and in light of the evolving market developments, there is a need to enhance its risk sensitivity and coverage. The new RBC framework’s key objectives are to enhance policyholder protection, observe international standards and best practices and to ensure insurers can perform its economic and social role on a sustainable basis.
On 15 July 2016, the Monetary Authority of Singapore (MAS) issued a third consultation paper on proposed revisions to the RBC framework for insurers. This consultation paper sets out the revised proposals, taking into account the feedback received from the second consultation paper along with various engagements the MAS has had with the industry. Our report summarises some of the key updates in the third consultation paper.
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