Annuities’ Non-U.S. Reinsurers May Face New Tests
June 6, 2024 by Allison Bell
Reinsurers based outside the United States could face new financial tests when they assume responsibility for U.S. life insurance policies and annuity contracts.
A panel at the National Association of Insurance Commissioners is considering proposals for testing the offshore reinsurers’ cash flow, to increase the odds that the reinsurers will have the financial strength to make good on life and annuity benefit promises.
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Wink’s Moore on the Market: Wow.
Powerful words from a consumer, to the National Association of Insurance Commissioners (NAIC):
“While I understand professional cordiality, mutual respect and common stakeholder concerns, the level of deference to the ‘regulated’ gives the impression of a relationship that’s too ‘comfortable,’” Gould wrote. “Don’t get me wrong — I’m a believer in insurance products — I just don’t want to be a ward of my State Guaranty Fund.”
NAIC is considering making reinsurers pass new financial tests, as a result of concerns that some insurers may reduce the assets behind annuities to unsafe levels. -sjm