Key Supervisory and Regulatory Initiatives

INSPECTIONS AND SUPERVISORY REVIEWS

Inspections on Reinsurance Management Strategy of Insurers
MAS Notice 114 outlines the guiding principles for the reinsurance management strategy (RMS) of insurers. It states that every insurer should have an RMS that is commensurate with its risk profile. We reviewed the RMS of ten insurers we inspected last year to assess the degree of alignment with MAS Notice 114. Our inspections revealed that insurers generally have adequate reinsurance coverage. However, we noted some weaknesses in the management of operational risks such as documentation and the procedures for the selection of reinsurers, as well as inadequate Board oversight.