What’s New: In Brief (May 26, 2008)

The Canadian Council of Insurance Regulators (CCIR) is preparing to release reports on its ‘Privilege Model’ and on managing potential conflicts of interest, both to be released later this year.
The CCIR’s privilege working group has completed its final report outlining the process followed in developing its privilege model, which outlines the extent to which insurers can claim privilege over self-assessment documents.
It has also presented its rationale for introducing new privilege and whistle-blower protection and summarizes stakeholder consultations, a CCIR memo says.
The final model and report are to be posted on the CCIR Web site this spring.
The CCIR’s industry practices review committee (IPRC) has conducted an implementation review of insurers and intermediaries to confirm the extent to which the industry has embraced principles for managing potential conflicts of interest. The review will also assess whether further regulatory action is required.
Surveys of insurance agents and companies have been concluded and the IPRC will present its recommendations in the fall, the CCIR memo says.

Derivatives, credit spreads and liquidity issues are the Top 3 risks facing Canadian banks are, but only 22% of Canadian respondents (24% worldwide) felt they were well prepared to manage those risks, according to a survey conducted by the Centre for the Study of Financial Innovation and PricewaterhouseCoopers (PwC).
The “Banking Banana Skins” survey ranks 30 risks according to their severity, based on the views of nearly 300 senior executives located in 38 different countries, a PwC release says.
“This year, two of the top three risks liquidity and credit spreads have never previously appeared in the rankings, an indication of how dramatically the risk scene has changed,” says Diana Chant, leader of the financial services practice at PwC. “The survey shows that the crisis has exposed a failure of controls within banks due to many factors including the growing complexity of finance, distorted incentive structures and insufficient regard to risk management.”
The most striking declining risk for Canada was over-regulation. This was in the Number 3 spot in the the poll last year, but fell to eighth place this year.