You are here:HomeIssuesInsurance Business Practices & Technical Information2014Insurers Push Back Against Systemic Regulation

Insurers Push Back Against Systemic Regulation

Seven insurers are working together to persuade Federal Reserve officials and other regulators that insurance companies are not risky like big banks and should not be subjected to the same rules for determining capital levels...
February 4, 2014

Seven insurers are working together to persuade Federal Reserve officials and other regulators that insurance companies are not risky like big banks and should not be subjected to the same rules for determining capital levels. Federal officials are working on new rules for insurance companies designated systemically important or for those that own banks. Insurers and state regulators have said the companies have enough capital under long-standing state requirements and that a bank-focused approach ultimately would drive up the price of life insurance products, in particular. Absent from the coalition is American International Group (AIG), whose CEO Robert Benmosche has said repeatedly that heightened oversight was a given for the property-casualty and life insurer.

The insurance coalition is mobilizing against capital rules that may force life insurers, like big banks, to hold billions of dollars in extra funds as a thicker buffer in times of market stress. Insurers — and their state regulators — said the companies have ample capital under long-standing state requirements and that a bank-focused approach ultimately would drive up the price of life-insurance products.

Insurers Push Back Against Stricter Regulation (Wall Street Journal 1/27/14) (subscription)