WASHINGTON (MarketWatch) — Global regulators are not paying enough attention to the risks to the global economy from the insurance sector, the International Monetary Fund warned Monday.

“The contribution of the insurance sector — particularly of life insurers — to systemic risk has increased,” and play an important role in financial turmoil spreading from one region to another, the IMF said.

Low interest rates may have induced firms to take on more risk, the IMF said, and the asset composition of firms may have become more similar, increasing exposure to common shocks and fire sales, the international agency said.

Insurance companies hold $24 trillion in assets, or about 12% of global financial assets, of which life insurance accounts for 85%, the IMF said.

Before the financial crisis, insurers were not thought to pose significant systemic risks. But the near collapse of American International Group AIG, -2.47% prompted a rethinking. Efforts in the U.S. to increase oversight of insurance companies has been met by industry resistance.

A federal judge last week sided with MetLife MET, +0.89% in its argument that it shouldn’t be designated a systemically important financial institution that should be subject to stricter regulations.

The IMF said regulators should go beyond the solvency and contagion risks of individual firms and take on the systemic risk arising from common exposures.

One necessary first step would be international adoption of capital and transparency standards.

Attention to “smaller and weaker firms” is also warranted.

Regular stress tests and countercyclical capital buffers should be adopted, the agency said.