The International Association of Insurance Supervisors (IAIS) has issued its proposed basic capital requirement for global systemically important insurers.

So far nine insurers – none of them Australian – have been designated global systemically important insurers, meaning they are large enough to affect the stability of the global financial system.

They face increased supervision and will be required to hold extra capital, in a bid to avoid a repeat of the global financial crisis.

Allianz, AIG, Generali, Aviva, Axa, MetLife, Ping An, Prudential Financial and Prudential will face higher loss absorption rules. The basic capital requirement will apply to their non-insurance activities and off-balance sheet exposures.

IAIS Head of Financial Stability John Maroney says the requirement is the first step in a long-term project to develop risk-based, group-wide global insurance and capital standards.

The requirement is open for consultation until August 8.