Yesterday, Rep. Randy Neugebauer, who serves as Chairman of the House Financial Services Subcommittee on Housing and Insurance, sent a letter to the Federal Insurance Office (FIO) Director Michael McRaith expressing his concerns that international standard setting proposals would impose "significant and unjust costs on U.S. insurers that would be borne by U.S. policyholders and investors."
The two proposed standards Rep. Neugebauer referenced are the International Association of Insurance Supervisors' (IAIS) ComFrame and IAIS' standards for systemically risky insurers.
In his letter, Rep. Neugebauer wrote that ComFrame "includes an onerous group-wide capital assessment process that would require U.S.-based international insurers to hold more capital on a discriminatory basis than similarly-situated insurance groups that operate entirely within the U.S.or other major jurisdictions," and that the standards would impose “significant and unjustified costs on U.S. insurers that would be borne by U.S. policyholders and investors.”
Rep. Neugebauer is also concerned that IAIS may name U.S. insurers as global systemically important insurers, or G-SIIs. Insurers deemed G-SIIs will face stricter supervision and increased capital requirements. A list of G-SIIs, if any are named, will be released by the end of June.
The Congressman is asking the FIO to not "rush to judgment" and to coordinate with the Financial Stability Oversight Council (FSOC) "to reject IAIS recommendations that do not comport with U.S. law and regulation."
Learn more from Rep. Neugebauer