NU Online News Service, Feb. 11, 1:10 p.m.EST

Members of the House Financial Services Committee are draftingletters to federal regulators asking that designation of anyinsurer as systemically risky be delayed until insurance expertsare in place to help with the process.

The effort is being heavily lobbied by the insurance industry.Three key trade groups, the American Council of Life Insurance, theAmerican Insurance Association and the Reinsurers Association ofAmerica, said the same thing earlier this week in a letter to Mr.Geithner, who heads the Financial Stability Oversight Council.

And officials of the Property Casualty Insurers Association ofAmerica asked the same thing in a letter sent to Mr. Geithner onJan. 17.

Mr. Geithner, as Treasury Secretary, chairs the FSOC.

Rep. Barney Frank, D-Mass., a key player in the crafting of thefinancial services reform legislation, has already sent a letter toTreasury Secretary Timothy Geithner asking that the process bedelayed until people with insurance expertise are in place.

Noting that no independent member has been appointed to theFSOC, as required by the Dodd-Frank law, and that an advisorymember, the director of the Federal Insurance Office, has not beenselected, Mr. Frank said in the letter, obtained by NU OnlineNews Service, "I therefore urge that decisions affecting thestatus of the insurance industry with regard to the FSOC criteriabe held off, if that is at all feasible, until the appropriatedegree of expertise is brought to bear."

And he said in the letter that he also is asking other membersof the FSC panel of both parties to send a similar letter to Mr.Geithner.

According to several industry officials, those being asked tosign the joint letter include Rep. Spencer Bachus, R-Ala., the newchairman of the panel, as well as Rep. Judy Biggert, R-Ill.,chairwoman of the panel's Insurance, Housing and Community AffairsSubcommittee; and Rep. Luis Guitierrez, D-Ill., ranking minoritymember of the subcommittee.

Also sending a letter are Rep. Ed Royce, R-Calif., and Rep.James Himes, D-Conn.

The effort was launched by the ACLI and AIA, who said in theirjoint letter to Mr. Geithner that classification of insurers shouldbe delayed until the independent member of the Financial StabilityOversight Council, having insurance expertise, is nominated by thepresident and confirmed by the Senate and the director of theOffice of the Federal Insurance Office has been selected by theTreasury secretary.

They suggested that any FSOC action involving insurers bedelayed until the agency has proposed qualitative and quantitativestandards that it may use to assess insurers, and has provided theinsurance industry and the public with an opportunity to comment onsuch standards.