New York State
Insurance Department


ISSUED: 12/3/99

FOR IMMEDIATE RELEASE

 

SUPERINTENDENT DIRECTS LIFE INSURERS TO DISCLOSE INFORMATION
TO ASSESS LIQUIDITY NEEDS

       Superintendent Neil D. Levin today announced that the Department has instructed all life insurers to provide information to assess their potential short-term cash requirements and the liquid assets that are available to service these requirements. In addition, the Department is seeking input in the development of enhanced reporting and more effective asset/liability management practices in the insurance industry.

       The purpose of these actions, which are detailed in the recently released Circular Letter #35, was prompted by the recent liquidity problems experienced by General American Insurance Company. The problems at this insurer revealed deficiencies in the financial reports filed by insurers and in the overall management of liquidity risk by that insurer.

       The information required by the new Circular Letter will allow the Department to better assess the current liquidity position of life insurers. More importantly, the Circular Letter solicits input from the industry regarding revisions to reporting by insurers that will increase the transparency of insurers’ liquidity management. The Department is also requesting comments relating to the strengthening of asset/liability management by the insurance industry.

       "The Department’s actions further goals shared by both the Department and the industry; improvement of risk management practices and enhancement in reporting to facilitate better monitoring of risks arising from asset/liability mismatches," said Levin.


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