IFNY: Stellar

Congratulations to the IFNY Board and its honorees for a beautiful, meaningful event as detailed on these pages.

Steve Menzies’ remarks were eye openers, and gave attendees a sparkling reminder of the fact that the business is good and worthwhile.

Bill Frazier got the Mary Lanning Public Service Award and the audience met new DFS head Adrienne Harris in a Q & A format that was largely about her, her career and her outlook, as it was a first introduction to the leaders present.

Martin Torres spoke about Girls’ Hope, Boys Hope, an initiative that IFNY has supported, providing high schoolers with internships at insurance companies over the summer.

It was a great event, as the fotos bespeak.

The Insurance Advocate continues to receive and read news of what we will call “assumed mandates”, or, in other words, instances in which regulators and others are imposing broad social impact strictures upon insurers, many popular political trends that are but tenuously tied to insurance. We note with displeasure that Lloyd’s has had to cancel its Annual meeting in person attendance because of the threats from Eco activists / terrorists and we read that there have been conflicts with ratings and raters predicated upon activism across the nation over the advocacy of certain kinds of investments and practices.

The charge of discrimination has been rather freely and inaccurately used in a number of contexts,  Now we  learn that S and S & P has taken a withdrawal action that is rather unusual..

S&P Global Ratings just published a request for comment (RFC) on proposed changes to its risk-based capital adequacy methodology for insurers and reinsurers .In their statement regarding the RFC, S & P .wrote:

“Given the nature of some of the concerns raised in comments that we have received, we have decided to withdraw the proposed approach for determining the rating inputs of bonds and loans, reinsurance counterparties, and deposits with credit institutions, as described in paragraphs 69-71, 81, 84, 187-189, and chart 4 and table 38. We are considering alternatives for the withdrawn elements of the proposed criteria to assess the potential credit risk associated with these types of exposures.

After we have had sufficient time to consider the high number of comments received, we intend to issue a subsequent RFC. This would incorporate any proposed alternative for the withdrawn elements, along with any other changes to what we originally proposed. After this subsequent RFC is completed, we will finalize the criteria article in its entirety, consistent with our criteria development process. At present, we expect to finalize the criteria no sooner than the fourth quarter of this year, but we will provide updates to market participants if our expectations change. The current criteria remain in effect until such time as any new criteria are issued and made effective.   

What is behind this? Is it some societal consideration that was missing, a sensitivity that has not had its presence in numbers? We will follow the story here, but it points to a growing restraint upon commerce that comes from the Elizabeth Warren angle on financial services and institutions..

Such developments point continuously to over reach and to regulators and regulatory practice led by those who believe that it is their job to set society and its ills aright rather than do the narrow job that they are supposed to do, i.e. protecting consumers, ensuring solvency, best insuring and underwriting practices, ensuring that claims or paid justly and that operatives in the business are properly licensed and such.  This is the general sway of what regulators are either appointed or elected to do.  When they go beyond that, they are taking to themselves powers and initiatives that are not included in their job descriptions. We do appreciate individuals who wish to do good in society, and many do. However, the vehicles for doing that are not the use of the one’s public regulatory office for  larger, irrelevant or tenuously relevant social purposes.

Dealing with the environment is important, dealing with discrimination, important, dealing with immigration, important and so on and so on and so on. But not everyone in the world is assigned to that job, including insurance regulators. The job of an insurance regulator is narrow, specific and very important. The expression” stick to your knitting” applies. SA