RETROACTIVE ATTACK ON BI POLICIES FOR PANDEMIC RISKS WOULD POSE MATERIAL THREAT TO INSURANCE SECTOR – IAIS.

The international association of insurance supervisions (IAIS) has warned legislators across the world that any efforts to retroactively open up business interruption (BI) policies to excluded covid-19 losses would create ‘material solvency risks for insurers and significantly undermine their ability to pay other types of claims. The association said that if such efforts were allowed, it threaten policy holder protection and financial stability which will further aggravate the dire financial and economic impacts of the virus. The IAIS also said that it favors the creation of alternative and probably a state-backed insurance mechanisms to help over future pandemic and stands ready to facilitate discussions on an international level.

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