Risk management and the global banking crisis: Lessons for insurance solvency regulation
Publication type
Journal article with impact factorAuthor
Ashby, SimonPublication Year
2011Journal
The Geneva Papers on Risk and Insurance - Issues and PracticePublication Volume
36Publication Issue
3Publication Begin page
330Publication End page
347
Metadata
Show full item recordAbstract
This paper investigates the causes of the banking crisis and the resulting lessons that need to be learned for insurance regulation. The paper argues that the banking crisis was predominantly caused by weaknesses in the management and regulation of banks, weaknesses that lead to problems such as flawed compensation schemes, poor risk management communication and an over-reliance on mathematical risk models. On the basis of these findings, doubts are expressed about the direction of certain insurance regulatory reforms—such as the focus on capital requirements and quantitative risk assessment (the so-called “Pillar I” of most reforms). It is also recommended that a more balanced approach to insurance regulation should be implemented, which places much greater emphasis on enhancing risk management guidance and supervisory tools (Pillar II) and improving disclosure rules (Pillar III).Knowledge Domain/Industry
Special Industries : Financial Services Managementae974a485f413a2113503eed53cd6c53
10.1057/gpp.2011.10