The International Association of Insurance Supervisors (IAIS) has finished drawing up requirements for the first global insurance capital standard.

The basic capital requirements (BCR) for global systemically important insurers have been endorsed by the Financial Stability Board in Switzerland.

“With design of the BCR now complete, the IAIS has concluded the first of several steps in its process to develop group-wide global insurance capital standards,” IAIS Executive Committee Chairman Peter Braumüller said.

The requirements, due to take effect next year, will be reported by insurers to group-wide supervisors and shared with the IAIS.

They apply to the main categories of a group’s activity: traditional life insurance, traditional non-life insurance, non-traditional insurance, assets and non-insurance.

The association’s next step is to develop higher loss-absorption requirements for global systemically important insurers, to be completed by the end of next year.

The final step is creation of a risk-based group-wide global insurance capital standard, due to be completed by the end of 2016 and applied to internationally active insurance groups from 2019.