The State Insurance Regulatory Preservation Act (H.R. 5059) has been introduced in the U.S. House of Representatives. It’s a bipartisan effort to get the Federal Reserve out of day-to-day insurance regulation. Currently the Fed is in charge of regulating and watching over insurance holding companies and making sure they are well-financed. The bill keeps that but does away with the states having to perform the same duties.
Day-to-day regulation — if this passes — is up to the individual states.
Pennsylvania Republican Rep. Keith Rothfus and Ohio Democrat Rep. Joyce Beatty don’t think this over-regulation is needed. In a statement Rothfus said, “This common-sense regulatory reform bill will ensure that federal and state regulators complement each other’s efforts. The current system of duplicative supervision is inefficient and creates added and unnecessary costs that hinder growth and hurt consumers.”
Nat Wienecke of the Property Casualty Insurers Association of America (PCI) says his organization is strongly in favor of the bill.
“PCI strongly supports the bipartisan efforts of Representatives Rothfus and Beatty to protect the time-tested state-based insurance regulatory system and for introducing the State Insurance Regulation Preservation Act,” he said.
The duplicative examinations of well-capitalized insurers is just increasing the cost of insurance to consumers and its reducing competition. “The Fed should be focused on the safety and soundness of banks and savings and loan institutions, not well-functioning state regulated insurers,” Wienecke said.
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