International Insurance Regulatory Issues 10th Annual Insurance Public Policy Summit “Confronting New Challenges in U.S. and International Regulation” Andrés Portilla Director, Regulatory Affairs Department March 12, 2014 1

Zurich Insurance Group Manulife Financial Allianz SE List of Current IIF Insurance Members . Swiss Re Prudential plc Zurich Insurance Group Manulife Financial Allianz SE Reaseguradora Patria Prudential Financial Aflac AIG China Taiping Insurance Group Co. MetLife Aegon N.V. Generali China Life Insurance (Group) AXA Group Aviva plc Ping An Insurance MassMutual Life Insurance Company Principal Financial Group Currently the IIF has 19 insurance members headquartered in 10 countries, including all 9 G-SIIs designated in July 2013:

The Global Framework G20 FSB IOSCO IAIS BCBS G20 Countries: Argentina, Australia, Brazil, Canada, China, France, Germany, India, Indonesia, Italy, Japan, the Republic of Korea, Mexico, Russia, Saudi Arabia, South Africa, Turkey, the United Kingdom, EEUU and the European Union G20 FSB (Financial Stability Board) IOSCO IAIS BCBS (Basel Committee on Banking Supervision) (International Organization of Securities Commissions) (International Association of Insurance Supervisors)

International Regulatory Agenda One key objective: to develop a harmonized, globally consistent regulatory framework for internationally active insurance groups Two key players: Financial Stability Board (FSB) and the IAIS Three main projects: Basic Capital Requirement (BCR) ComFrame (Common Framework for the Supervision of IAIGs) Global Insurance Capital Standard (ICS)

Apply to All Other Insurers Global Insurance Regulatory Framework Overview G-SIIs IAIGs All Insurers ICPs Step 1: BCR (to be developed by end of 2014) Step 2: HLA(to be developed by end of 2015) ComFrame expands on ICPs ComFrame Step 3: ICS (to be developed by end of 2016) Recovery and Resolution Enhance Group-wide Supervision G-SII Policy Measures Capital Adequacy Component of ComFrame   BCR HLA ICS ComFrame ICPs Apply to G-SII  Apply to IAIG TBD  Apply to All Other Insurers

Global Systemically Important Insurers(G-SIIs)Policy Measures Overview Introduction On July 18, 2013, IAIS announced that it had developed a framework of policy measures for; however, the proposed HLA measures will be subject to further consultation before they are finalized in 2015 in advance of the proposed implementation date of 2019. Enhanced Supervision Recovery and Resolution Higher Loss Absorbency Components Implementation Timeline Time Action July 2013 Designation of the first G-SII cohort July 2014 Crisis Management Groups (CMG) to be established for the first G-SII cohort   Systemic Risk Management Plan (SRMP) to be completed End 2015 IAIS to develop implementation details for HLA that will apply to designated G-SIIs starting from 2019 November 2017 The FSB to designate the cohort of G-SIIs, based on the IAIS methodology and 2016 data, for which the HLA policy measure will apply, with implementation beginning in 2019 January 2019 G-SIIs designated in November 2017 to apply the HLA requirements

Basic Capital Requirements(BCR) and Higher Loss Absorbency(HLA) As a foundation for HLA requirements for G-SIIs, the IAIS will develop straightforward, basic capital requirements to apply to all group activities, including non-insurance subsidiaries. The BCR is intended to balance between simplicity and risk sensitivity, as well as provide a more comparable foundation for the HLA than local capital requirements. Based on the foundation of the BCR, the higher loss absorbency requirements will focus on systemic risks and non-traditional non-insurance (NTNI) activities as the second step towards the ICS. The HLA will be completed in 2015 and implemented to G-SIIs from 2019. HLA Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun First BCR Consultation Ends BCR Field Testing Starts BCR Field Test Ends Expert Inputs Concludes . Second BCR Consultation Starts IAIS approves BCR Proposal G20 Endorses BCR Proposal Analysis on Field Test Results Concludes. Second BCR Consultation Ends FSB Reviews BCR Proposal BCR 2014 Development Timeline

Common Framework for the Supervision of Internationally Active Insurance Groups (ComFrame) Introduction ComFrame is a set of international supervisory requirements focusing on the effective group-wide supervision of IAIGs. ComFrame is built and expands upon the high level requirements and guidance currently set out in the IAIS ICPs, which generally apply on both a legal entity and group-wide level. ComFrame consists of the following three modules: Module one: The Scope of ComFrame Module two: The IAIG (including capital adequacy requirements) Module three: The Supervisor (including establishment of supervisory colleges) Three Modules of ComFrame Development 2010 to Dec 2013 Field Testing 2014 to end of 2018 Implementation starts in 2019 ComFrame Development Timeline

ICS Development Timeline Global Insurance Capital Standards(ICS) Introduction On October 9, 2013, the IAIS announced that it is committed to develop a risk based ICS by the end of 2016, followed by a two-year period of testing and refinement with supervisors and IAIGs. The ICS is scheduled to be implemented beginning in 2019. After completion, the ICS will be included in ComFrame replacing the content of Module 2 Element 5 Capital Adequacy Assessment. The IAIS has committed to develop the ICS in the following three steps: The first step is to develop ICS by end 2016. The second step is to test and refine the framework by 2018. The third step is to implement it globally starting in 2019. Development Steps of the ICS Development Phase In three steps by the end of 2016 Testing and Refining To the third quarter of 2018 Implementation starts in 2019 ICS Development Timeline

International Insurance Regulatory Issues 10th Annual Insurance Public Policy Summit “Confronting New Challenges in U.S. and International Regulation” Andrés Portilla Director, Regulatory Affairs Department aportilla@iif.com 10