Federal Insurance Office Takes Shape
The Dodd-Frank Act established the Federal Insurance Office, or FIO, within the Treasury Department. FIO Director Michael McRaith recently explained the FIOs current and expected activities.
The FIO advises the Secretary of the Treasury on major domestic and prudential international insurance policy issues. As part of this work, it monitors all aspects of the insurance industry, including the availability of affordable insurance to traditionally underserved communities and consumers. The FIO also assists the Secretary in administering the Terrorism Risk Insurance Act, which helps support the market for terrorism risk insurance products.
Congress gave the FIO authority to identify issues or gaps in the regulation of insurance that could contribute to a systemic crisis in the insurance industry or the broader U.S. financial system, and to make recommendations to the Financial Stability Oversight Council, or FSOC, regarding whether an insurer or its affiliates should be subject to supervision by the Board of Governors of the Federal Reserve.
Over the next several months, FIO will focus on preparing a statutorily-mandated study and report due to Congress in January 2012 on how to modernize and improve the U.S. system of insurance regulation. Treasury also intends to announce members of the Federal Advisory Committee on Insurance, or FACI. The FACI will provide advice and recommendations to the FIO. The FIO will also soon be submitting two statutorily required-reports to Congress: one regarding the state of the insurance industry and another on whether in the last year FIO has acted to preempt any state insurance laws, which it has not.
Check dodd-frank.com frequently for updates on the Dodd-Frank Act and other important securities law matters.
Contact Steve Quinlivan for more information.