IPS: Regulatory constraints on Life vs. Non-life insurance


Why is it that regulatory considerations are less onerous for non-life insurance companies as compared to life insurance?

To me, it’d be the opposite as operational results from non-life cos are much less predictable and volatile. Their risk tolerance is lower and duration lower, so it would make sense to be more restrictive (e.g. on asset classes or maturities) to guarantee payouts are made when claims occur. Why is the opposite true?


Compared to non-life insurers, life insurers invest monstrous amounts of $$$$$$$ on behalf of its policyholders to be paid out at some future date. You better believe that’ll attract extra regs and scrutiny!!!