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IMF: Insurance industry a growing risk to financial system 

April 5, 2016

Peter Schroeder, The Hill

Insurance companies pose a larger risk to the financial system than they did before the financial crisis, according to the International Monetary Fund (IMF).

In a new report, the IMF found that the insurance industry, particularly life insurers, have taken on a more important role in the global financial system and are particularly susceptible to some economy-wide risks. As such, the international body recommended that governments keep a close watch on that sector and consider heightened rules on those firms.

While the IMF urged stricter rules on insurance companies, its findings came several days too late for the U.S. government.  On Wednesday, a U.S. judge ruled that federal regulators did not have the right to label the insurance company MetLife as “systemically significant,” which would have subjected it to stricter rules already required of the nation’s largest banks.

MetLife sued the nation’s top financial regulators over their efforts to impose stricter rules, arguing that its work did not pose a threat to the overall financial system. Read more

 
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