The International Association of Insurance Supervisors (IAIS) today announced its agreement with the European Insurance and Occupational Pensions Authority (EIOPA) to better understand supervisory approaches.
The deal involves EIOPA joining the multilateral memorandum of understanding (MMoU).
Set up by the IAIS, the memorandum is a global framework for co-operation and information exchange among insurance supervisors.
EIOPA's chairman Gabriel Bernardino said: "This agreement strengthens our ability to work co-operatively with other supervisory bodies and to monitor large cross-border insurers."
"Such co-operation is critically important to foster effective supervision, to enhance financial stability and to protect European consumers."
EIOPA told The Actuary that the deal would not affect insurers and their operations would remain unchanged.
Both organisations said that through the MMoU, supervisors are able to exchange relevant information and provide assistance to other members, thus promoting "sound supervision of cross-border insurance operations" to enhance consumer protection.
Victoria Saporta, chair of the executive committee of the IAIS, said: "In order to achieve our ultimate goal of policyholder protection within the global insurance marketplace, an insurance supervisor needs the ability to cooperate quickly and effectively.
"The MMoU is an essential regulatory tool - not only in crisis situations, but on a day-to-day basis - for supervisors to foster safer and more stable insurance markets."
Set up in June 2009, the MMoU membership has grown to 56 signatories, representing over 65% of worldwide premium volume.
Among them are supervisory entities in Austria, Germany, India, Italy, Japan, Luxembourg, the UK and numerous jurisdictions within the US such as California and Florida.