Document Type : Promotional-Science Article

Authors

• F. Atatalab ¹
• L. Niakan ²

¹ Department of Actuarial Science, Shahid Beheshti University, Tehran, Iran

² Professor Assistant, Insurance Research Center

Abstract

Purpose: This article introduces the risk assessment process of insurance companies in the risk-based monitoring system and how to monitor them.
Methodology: The risk assessment framework for insurance and reinsurance companies introduced by (KNF, 2018) was used. This framework is a comprehensive process that uses all available information of the supervisory body about the insurance company (reinsurance) and the information obtained as a result of activity licensing measures and off-site inspection and control measures during on-site inspection about the insurance company (reinsurance). And it is done through the questions of the questionnaires sent to the insurance company.
Findings: The risk-oriented supervisory approach is based on the focus of the supervisory body on serious risk areas and on companies that need more attention. One of the requirements for the implementation of the new approach is to approach the basic principles of the International Association of Insurance Supervisors, preparing risk management reports, actuarial reports, rating insurance companies, analyzing complaint data and separating life and non-life insurance accounts.
Conclusion: In order to achieve the goal of effective supervision in the country's insurance industry and to achieve risk-based supervision, it is necessary to draw a road map, which is actually the same measures necessary to achieve the desired situation:
• Adaptation of the insurance regulations of the country with the basic principles of insurance presented by the International Association of Insurance Supervisors;
• Separation of life and non-life insurance accounts;
• Development of actuarial performance standards;
• Requiring insurance companies to prepare financial and risk self-assessment reports to implement the requirements of the corporate governance regulations (risk management) and also according to the principles of IAIS;
• Use of international and general standards and regulatory and regulatory standards of company risk management;




• Preparation of internal control reports by insurance companies.

Keywords

• Supervision
• Insurance Risk
• Credit risk
• Market risk
• Operational risk
• Capital adequacy
• Corporate governance