Filed Under:Carrier Innovations, Regulation/Legislation

Senators Join Industry in Calling on Regulators to Avoid Bank-Centric Rules for Insurers

Ahead of a comment-period deadline, almost two dozen members of the Senate from both sides of the aisle sent a letter to the top federal-banking regulators warning them that the application of a bank-centric capital regime to the insurance industry would fundamentally alter the nature of the business, undermine prudential supervision and unintentionally harm insurance policyholders. 

The letter, also sent to the heads of the Federal Deposit Insurance Corporation (FDIC) and the Office of the Comptroller of the Currency (OCC), raised the question of Congress’ intent in designing the rules—namely that insurers should be treated differently in line with their business models.

The senators point to a need for the regulators to acknowledge how insurance companies rely upon long-term assets to fund long-term liabilities while banks use a variety of bonds, equity, and short-term debt to fund their operations. 

Insurers have repeatedly made the case that bank liabilities are short-term and assets are long-term while the opposite is true of insurance, which has liquid assets but longer-term liabilities. 

Featured Video

Most Recent Videos

Video Library ››

Top Story

Hosting a Super Bowl 50 party? Watch out for these 5 risks

Follow these five tips to keep your guests and your home safe during your Super Bowl 50 party.

Top Story

Win big with these 7 food safety tips for your Super Bowl 50 party

Avoid food safety penalties at your Super Bowl party by following these seven tips.

More Resources

Comments

eNewsletter Sign Up

Carrier Innovations eNewsletter

Critical news on the latest tech solutions, information security, analytics and data tools and regulatory changes to help decision-makers at insurance carriers keep their business thriving – FREE. Sign Up Now!

Mobile Phone

Advertisement. Closing in 15 seconds.