Insurance Capital Standard (ICS)
International capital standard developed by the IAIS for internationally active insurance groups.
The Insurance Capital Standard is an international solvency standard developed by the International Association of Insurance Supervisors for internationally active insurance groups. Its ambition is to create a common language for measuring required capital, in order to improve comparability and cooperation between supervisors facing groups whose activities span many jurisdictions with heterogeneous regimes, from European Solvency II to US risk-based requirements. Developed over many years through phases of testing and consultation, the standard generated tensions, notably between the European market-value approach and the US approach, which promoted an alternative method deemed equivalent. The adoption of the standard marks a step toward global prudential convergence, without erasing regional specificities. For a large international group, it represents an additional layer of capital measurement, interacting with the local regimes to which it remains subject.
Textbook case: an insurance group present in Europe, the United States and Asia must contend with the international capital standard, adopted by the IAIS in December 2024, in addition to local regimes such as Solvency II.
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