How the Financial Crisis Affects Pensions and Insurance and Why the Impacts Matter.
Title:
How the Financial Crisis Affects Pensions and Insurance and Why the Impacts Matter.
Author:
Tower, Ian.
ISBN:
9781451917277
Personal Author:
Physical Description:
1 online resource (58 pages)
Series:
IMF Working Papers
Contents:
Contents -- I. Introduction -- II. The Role of Pension Plans and Insurance Companies -- III. Key Pensions and Insurance Characteristics -- IV. The Nature of Assets and Liabilities -- V. Sources of Vulnerability -- Asset shocks -- Liability shocks -- VI. Risk Sharing and Transmission Channels to the Rest of the Economy -- A. Pensions -- B. Insurance Companies -- VII. Policy Conclusions -- References -- Tables -- 1. Asset Changes in Corporate Plans (Major Stock Indices) -- 2. Asset Changes in Mandatory DC Plans -- 3. Insurance Sector Announced Losses and Capital-raising to Date -- 4. Liability Changes in Corporate Plans (Major Stock Indices) -- 5. Funding Ratio Changes in Corporate Plans (Major Stock Indices) -- 6. Composition of Household Financial Balance Sheet in Select OECD -- 7. 2008 Financial Crisis and Multi-funds in Latin America -- 8. Public Debt, Pension Spending and Implicit Pension Debt for Thirty Five Low and Middle Income Countries for Various Years During the end-1990s and 2000 -- Figures -- 1. Role of Financial Assets in Overall -- 2. Assets in DB and DC Private Plans (OECD and Latin America) -- 3. Pension Assets as Percent of GDP in OECD Countries (2007) -- 4. Pension Assets as Percent of GDP in Latin American Countries (06/2008) -- 5. Asset Allocation of OECD Private Pension plans (2006) -- 6. Asset Allocation (average) of Latin American Pension Plans (06/2008) -- 7. Pension Fund Returns in Selected OECD Countries (January-October 2008) -- 8. Corporate Plan Assets in Major Stock Indices (January 2007-April 2009) -- 9. CDS Spreads in the Insurance Sector -- 10. Bloomberg Insurance and Bank Indices -- 11. Corporate Plan Liabilities in Major Stock Indices (January 2007-April 2009) -- 12. Changes in Accounting Funding Levels of Corporate Plans of Major Stock Indices (January 2007-April 2009).
13. Funding Ratios of U.S. State and Local Plans -- 14. Minimum Pension Guarantees -- Boxes -- 1. Insurance Companies' Balance Sheets: The Importance of ALM -- 2. Insurance Companies Accounting and Solvency Requirements -- Annexes -- I. Liability Valuation Rules in Select OECD Countries -- II. "Simpler" Presentation of FAS 87.
Abstract:
This paper discusses the key sources of vulnerabilities for pension plans and insurance companies in light of the global financial crisis of 2008. It also discusses how these institutional investors transit shocks to the rest of the financial sector and economy. The crisis has re-ignited the policy debate on key issues such as: 1) the need for countercyclical funding and solvency rules; 2) the tradeoffs implied in marked based valuation rules; 3) the need to protect contributors towards retirement from excessive market volatility; 4) the need to strengthen group supervision for large complex financial institutions including insurance and pensions; and 5) the need to revisit the resolution and crisis management framework for insurance and pensions.
Local Note:
Electronic reproduction. Ann Arbor, Michigan : ProQuest Ebook Central, 2017. Available via World Wide Web. Access may be limited to ProQuest Ebook Central affiliated libraries.
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