^aMunich Reinsurance Company, Munich, Germany. E-mail: cfrey@munichre.com

Abstract

This article takes a global view of risk-based capital management in the insurance business, which nowadays is a key issue of the management of insurance companies. A thorough analysis of recent regulatory authorities' and rating agencies' positions shows that it is also a core topic in discussions about future financial frameworks in general. As a matter of fact, many parties are involved in the development of these frameworks, so there is an urgent need for common principles. This article identifies the essentials of future financial frameworks, highlights aspects which should be affected by a unified economic view, and outlines what progress has already been made.