The International Association of Insurance Supervisors (IAIS) has set the wheels in motion for a global framework intended to improve supervision of international insurance groups and their associated risks.

A concept consultation paper is due in the first half of next year with a full framework in place as early as 2013.

The move follows increased scrutiny of diversified insurance providers in the wake of the global financial crisis.

The IAIS says it intends to better monitor group structures and transactions “with a view to identifying risks and establishing safeguards where necessary”.

The framework is also expected to promote greater supervisory cooperation and interaction.

IAIS Executive Committee Chair Peter Braumuller says the work represents an “important contribution to our ongoing wider efforts to promote financial stability.

“The framework will put internationally active insurance groups on a similar footing and allow home and host supervisors to better understand and supervise such groups,” he said.

The IAIS represents insurance regulators and supervisors drawn from 190 jurisdictions in almost 140 countries, with a further 120 observer members.

The IAIS counts the Australian Prudential Regulation Authority among its members, with the Insurance Council of Australia, QBE and IAG involved as observers.