Canadian federal financial regulators issued a revised guideline Thursday concerning earthquake exposures.
The Office of the Superintendent of Financial Institutions (OSFI) released a revised version of its guideline that sets out what it sees as good practices for managing exposure to the threat of earthquakes. The publication of the updated guideline follows a public consultation that began in August last year.
OSFI says the revised guideline represents a principles-based approach to managing earthquake exposure. And, it notes that the final version incorporates comments received on its initial consultation, and the efforts of a working group of regulators that was formed back in 2010 (including OSFI, the British Columbia Financial Institutions Commission, Qubec’s Autorité des marchés financiers, and the Insurance Bureau of Canada) to review the original guideline, which was first developed in 1998.
“OSFI has refreshed its guidance to reflect the lessons learned and technological changes that have occurred over the past fourteen years,” said Mark Zelmer, assistant superintendent, regulation sector.
“The revised guideline will help Canadian insurance companies continue to be well prepared for the financial consequences if a major earthquake were to occur in Canada.”
Additionally, OSFI says that it continues to work with the provincial regulators and the Insurance Bureau of Canada on related financial requirements, and will incorporate any future changes to its capital requirements for insurers.