Sending a signal to the IAIS ahead of its November meeting, Senate Banking today held a well-attended hearing at which Senators demanded that the IAIS deem the U.S. approach to insurance group capital equivalent to its International Capital Standard (ICS) Version 2.0. FRB, FIO, and NAIC witnesses expressed serious concerns with the ICS, saying that IAIS needs to establish clear frameworks for changing the standard and determining equivalency. Chairman Crapo (R-ID), Sen. Toomey (R-PA), and Sen. Menendez (D-NJ) seemed comfortable with IAIS establishing guidelines for equivalency ahead of the monitoring period and later assessing the comparability of the U.S. regime. However, Sens. Rounds (R-SD) and Scott (R-SC) pushed U.S. IAIS representatives not to agree to any ICS that fails to recognize the U.S. regime at the outset. The witnesses all stressed the need to stay engaged in the process, saying that the U.S. will not adopt any standard that is incompatible with its regime.
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