Kathmandu. Insurance regulators in the Asia-Pacific region and the European region are helping boost economic growth by easing insurance regulatory provisions.
According to Fitch Ratings, Australia in particular is proposing to reduce capital changes to better match asset liability. “Australia is continuing to make the annuity business more attractive and affordable,” Fitch said in its report.
China has also announced a 10 percent cut in equity investment. The move is expected to encourage insurers to infuse more capital into the corporate sector, thereby boosting economic growth, Fitch said.
On the Western Front, the European Commission has proposed to reduce capital charges for some long-term equity investments.
Insurance regulators in the US and UK are concerned about the growing use of reinsurance treaties funded in life insurance. “The US has introduced an asset adequacy test to ensure cash flow matching of assets and liabilities in these treaties,” Fitch said, adding that regulation on UK-funded reinsurance is likely to be tightened. ’
