After FSOC Rule, Industry Maintains P&C Is Not Systemically Risky

WASHINGTON—Spokesmen for insurance-trade groups insist that when all is said and done, officials of the Financial Stability Oversight Council will support insurers’ view that insurance activities by their very nature do not pose a threat to the stability of the U.S. financial system.

J. Stephen Zielezienski, American Insurance Association general counsel, says, “By incorporating risk-related metrics in the process, the final rule reflects improvement over the first proposed rule.”

He adds, “AIA hopes that [the FSOC] will use the designation sparingly and apply it only to the companies that pose a systemic threat to U.S. financial stability.”

He notes that AIA believes property and casualty insurers should be screened out of the systemically important financial institutions (SIFI) designation since they do not pose a threat to financial stability.

Jimi Grande, senior vice president, federal and political affairs for the National Association of Mutual Insurance Companies, makes a similar point, stating, “To the extent that the final rule is similar to the proposed rule from October of last year, the FSOC seems properly focused on the type of institutions which experienced the most difficulty during the financial crisis.”

Ben McKay, senior vice president of federal government relations for the Property Casualty Insurers Association of America issuing a statement supporting the final rule.

“The final FSOC rule takes important steps to recognize that traditional home, auto and business insurance activities are not systemically important,” McKay says.

He adds that the Dodd-Frank Act appropriately treated insurance very differently than other sectors of the financial services industry.

Comments

Resource Center

View All »

Complimentary White Paper: The Compression of Workplace Time

How brokers and carriers respond to the compression of workplace time will create significant competitive...

The Changing Insurance Consumer: 6 Ways to Create Profitable Relationships

Today’s mobile and web-savvy consumers have new expectations when it comes to interacting with your...

Contractors General Liability Coverage 102

What is a prior work exclusion? Which option is right for my client? Why do...

Sign up today to get a 50% matching credit -...

Insurance marketing sometimes seems like it's a game of swings and misses, but we're here...

Guide: 5 Steps to Selling Cyber

Cyber risk and data security is on the agenda of every business owner and executive....

Citation Correlation

Do rigger and signalperson qualifications correlate with the cause of crane and rigging accidents? ...

Complete Guide to Electronic Signatures in Property & Casualty Insurance...

In property and casualty insurance, closing new business quickly is key. Learn how to leverage...

INSTANT ACCESS: Complimentary Sales Closer Questionnaires

Help property owners or managers compare your commercial residential property insurance coverage vs. the competition....

Determining Vacant Property Perils and Valuations

Are your clients fully covered for Vacant Properties? In this economic climate, your insureds may...

Risk Management for Law Firms

This package of 3 concise risk management articles offers straightforward content and practical suggestions law...

Claims Connection eNewsletter

Breaking news on disasters, fraud, legal trends, technology, and CE initiatives for the P&C claim professional – FREE. Sign Up Now!

Claims-Handling Guidelines

Claims Magazine is providing the following free guidelines and regulations in order to help adjusting professionals stay abreast of each state’s unique property and casualty claim-handling requirements.

View our State Guidelines »

Advertisement. Closing in 15 seconds.