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Rep. Hensarling Says FIO Report Should Be Issued “Without Delay”

For the past year, we haven’t had to worry much about the Federal Insurance Office (FIO), but that may soon change...
February 21, 2013

For the past year, we haven’t had to worry much about the Federal Insurance Office (FIO), but that may soon change. The FIO is currently 14 months late in releasing a report on ways to enhance and streamline the U.S. insurance regulatory system. The report was due to Congress on Jan. 12, 2012, but it has yet to be issued.

Background: This report was required by Congress as part of the authorization of the FIO under the Dodd-Frank Act. PIA strenuously opposed to this provision of the law from the outset, stating that the FIO is not positioned to conduct an objective, unbiased study on this topic.

Unfortunately, the enabling legislation laid out leading questions that seemed designed to foster negative perceptions of state insurance regulation. The questions contained a clear bias. We also pointed out that we thought it was improper to have the FIO conduct the study, because that would put the office in a position to recommend to Congress that it be given regulatory powers, which the Dodd-Frank Act specifically prohibited. PIA went public with our objections. We also pressed the issue in a one-on-one meeting with FIO Director Michael McRaith.

Since then, the report hasn’t come out. The FIO’s silence was noticed when the House Financial Services Committee, under new Chairman Rep. Jeb Hensarling (R-Texas), issued its Oversight Report, which included a notation (p. 15) that the FIO missed multiple deadlines. Rep Hensarling said the FIO report should be released “without further delay.” FIO Director McRaith has only said the report would be released shortly.

For additional insight into the FIO report, read PIA’s article “Potential Frankenstein” published in the December 2011 issue of American Agent & Broker.

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