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Executive summary (partial) "In the aftermath of the 2007/2008 banking crisis, a significant number of reforms have been introduced by international, European and national policymakers as a response to problems in the banking sector which have negatively impacted the entire economy. These efforts to foster sound and stable financial markets are fully supported by the insurance industry. A worrying trend has, however, emerged. Several regulatory initiatives directed at the banking business were eventually transposed to other financial industries, without an appropriate distinction being made between the vastly different business models which make up the financial sector. Banks and insurers have significantly different business models and play very different roles in the economy. The core activity of insurers and reinsurers is risk pooling and risk transformation, while that of banks is the collection of deposits and the issuing of loans, together with the provision of a variety of fee-based services. Consequently, the balance sheet of insurers is economically stable, as fairly longterm policyholder liabilities are matched with assets of corresponding duration. In the case of banks, which engage in maturity transformation, assets and liabilities are not matched, and the average duration of most bank assets is generally longer than the average duration of their liabilities. Insurers and banks also play quite different roles in relation to the efficient functioning of the whole economy …"

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