On October 1, Congressman Paul Kanjorski, Chairman of the House Financial Services Subcommittee on Capital Markets, Insurance, and Government Sponsored Enterprises, released a discussion draft of legislation titled the Federal Insurance Office Act of 2009. The proposal would create a federal insurance office to coordinate and establish federal policy on international insurance issues and monitor all aspects of the insurance industry including “identifying issues or gaps in the regulation of insurers that could contribute to a systemic crisis in the insurance industry or the U.S. financial system.” The authority of the office would extend to all lines of insurance except health, and its director would be appointed by the Secretary of the Treasury. While the main function of the office would be to monitor the industry and gather information, the proposal authorizes the preemption of any state insurance regulations found to violate international insurance agreements. The office would also assist in administering the Terrorism Insurance Program within the Treasury and consult with state regulators regarding insurance issues of national and international importance.
To read a discussion draft of the proposed legislation, click here.