Public consultation on draft revised Application Papers on recovery and resolution
The consultation is closed and the Application Papers have been published.
The IAIS has now published the final versions of its revised Application Papers on recovery and resolution. The original versions of these papers were first published in 2019, and have now been updated following a comprehensive review and consultation.
The Application Papers provide further guidance on the updated ICPs and ComFrame standards. In December 2024, the IAIS adopted updates to the Insurance Core Principles (ICPs) and the Common Framework for the supervision of internationally active insurance groups (ComFrame), including recovery and resolution-related standards, which are part of the Holistic Framework for the assessment and mitigation of systemic risk in the insurance sector. These standards were updated to further enhance their clarity and incorporate lessons learned from their implementation. Notably, while also further aligning them with the Financial Stability Board (FSB) Key Attributes of Effective Resolution Regimes for Financial Institutions. The updated papers also provide insights into more recent practices and examples to support their application.
Following the consultation, updates have been made throughout both papers in response to the comments received, mainly to provide further clarification and additional guidance. Notably, some major changes have been made to the reinsurance section (Section 2.4 Considerations related to reinsurance) in the Application Paper on resolution powers, preparation and plans, including matters related to asset-intensive reinsurance (AIR).
The papers cover the following topics related to ICP 12 (Exit from the market and resolution) and ICP 16.15 (Recovery planning), including their related ComFrame material, respectively:
Application Paper on resolution powers, preparation and plans
- Objectives and concepts of resolution of insurers, including reinsurance-related considerations and descriptions of “no creditor worse off than in liquidation” (NCWOL) principle
- Concepts and examples of conditions for entry into resolution
- Descriptions and practical application of resolution powers
- Concepts and key aspects of preparation for resolution
- Objectives and key elements of a resolution plan, including a process for determining the need for a resolution plan
- Key elements of resolvability assessment and resolving identified impediments
- Cooperation and coordination amongst involved authorities both in normal and crisis times
Application Paper on recovery planning
- Objectives and concepts of recovery planning, including a relationship with other enterprise risk management (ERM) tools, such as Own Risk and Solvency Assessment (ORSA) and contingency plans
- Scope of application and proportionality of the requirement for a recovery plan
- Governance-related matters in recovery planning, including the development and approval process of a recovery plan and the relevant overall risk management of an insurer
- Key elements of a recovery plan and examples of their application
- The role of supervisors in recovery planning, including the assessment of recovery plans and supervisory cooperation and coordination
A public discussion session will be held via webinar on 26 August 2026 14:00 – 15:00 CEST to present the Application Papers and answer any questions from stakeholders. Click here to register.