Commissioner Caride further reported that the Financial Stability (EX) Task Force’s mandate is to analyze existing post financial crisis regulatory reforms for their use in identifying macroeconomic trends, including identifying possible areas of improvement or gaps.

• The Task Force aims to improve the ability of state insurance regulators and the industry to address macroprudential impacts and overall financial stability.

Commissioner Caride reported that a major project of the Task Force is the Macroprudential Initiative (MPI), which focuses on making improvements in four main areas:

• 1) liquidity risk;
• 2) recovery and resolution;
• 3) capital stress testing; and
• 4) counterparty exposure/concentration.

Liquidity risk is a priority, and the Task Force received approval for financial statement blanks changes effective at year-end 2019, that should help to better identify liquidity risks.

The Task Force also has made progress toward the design of a liquidity stress testing framework using a cash flow approach. (4-3)

2019-1, NAIC Proceedings