Insurance can provide unique and important benefits to a society, but those benefits cannot be realized unless markets are liberalized, said David Snyder, vice president and assistant general counsel for the American Insurance Association (AIA), Thursday at the World Trade Organization (WTO) in Geneva, Switzerland.
Snyder was among members of the Financial Leaders Working Group, who are in Geneva for two days to call for urgent progress on the Doha Round of trade talks to further liberalize trade in financial services. The Financial Leader Working Group includes leading companies and business associations representing a broad spectrum of financial services. Members include Australia, Canada, the European Union, Hong Kong, Japan, Switzerland and the United States.
“Insurance can provide financial security to support economic growth, private compensation of loss in place of government compensation or no compensation, investment in basic infrastructure and a financial and political focus on loss prevention and mitigation,” Snyder said.
However, Snyder stressed, “Insurance can only provide those societal benefits if the market is liberalized and insurers can enter the market, operate successfully and earn a profit.” Snyder was speaking during an international insurance panel that was part of a seminar for WTO delegations.
“Foreign insurance companies should be treated according to the same rules as domestic companies, and regulation must be transparent,” Snyder said. “Countries must set their local capital requirements in a manner consistent with international norms, and insurers should be free to find the best reinsurance globally both for efficiency and for global risk spreading.”
Snyder called for accelerating the process for opening markets globally. “The next few months of the Doha Round offer an extraordinary opportunity for many countries to quickly realize the societal benefits of insurance by tabling comprehensive insurance liberalization requests and offers,” he added.
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