NAMIC Welcomes FIO Reform Legislation

Legislation introduced today to replace the Federal Insurance Office with a U.S. Insurance Representative will refocus the federal government on its limited mission of informing policymakers by removing its ability to duplicate state authority and providing regulatory clarity, according to the National Association of Mutual Insurance Companies.

The McCarran-Ferguson Restoration Act, introduced by Rep. Troy Downing, R-Mont., a former state insurance commissioner, and Rep. Scott Fitzgerald, R-Wis., will eliminate FIO while preserving key aspects under a newly created position at the Department of the Treasury. The U.S. Insurance Representative will represent the federal government on the international stage, retain a nonvoting seat on the Financial Stability Oversight Council, and assist in administration of the Terrorism Risk Insurance Program. The bill takes its name from the federal law enshrining state authority over the business of insurance and seeks to strike the right balance between the primary role of state regulation and that of the federal government.

“States have been regulating insurance for more than a century, and federal law has codified this for decades, Congress should not let a federal agency encroach on this sovereignty,” said Jimi Grande, senior vice president of federal and political affairs for NAMIC. “Congress created FIO with explicit language that it is not a regulatory agency, but the years since have seen repeated efforts by the office to test those limits and expand its power. Through needless data calls and reports, FIO has duplicated, or worse intruded on and undermined, the work being done by the states, and at a cost ultimately borne by consumers.”