NAMIC Welcomes Committee Vote to Reform Federal Insurance Office

Legislation to reform and clarify the role of the Federal Insurance Office took an important step toward becoming law today with passage by the House Financial Services Committee. The committee’s approval was welcomed by the National Association of Mutual Insurance Companies, which urges swift consideration by the full House of Representatives.

“While FIO plays a useful role monitoring the industry, it is meant to be a resource, not a regulator. This bill just clarifies that important distinction by removing what is normally an authority reserved for functional regulatory agencies,” said Jimi Grande, senior vice president of federal and political affairs for NAMIC. “Insurance is regulated appropriately at the state level. Yet FIO maintains its subpoena authority for work that would be overreaching and outside the office’s scope. There’s just no need for it and when they get political pressure to overreach and duplicate state efforts it costs time and money.”

Introduced in September 2023 by Reps. Scott Fitzgerald, R-Wis., Mike Flood, R-Neb., and Blaine Luetkemeyer, R-Mo., H.R. 5535, the Insurance Data Protection act, would strip the Federal Insurance Office of its subpoena authority and prevent the office from being used as an enforcement agency or de facto regulator by this or any future administration seeking to collect data directly from an insurer. The legislation was introduced following FIO’s recent unprecedented and duplicative climate data proposal, which was ultimately rolled back to be carried out by the states but only after extreme outside pressure.

The committee approved the Insurance Data Protection Act by a party-line vote. However, support for the state-based system of insurance is not a partisan issue.

“When the concerns about FIO’s data call were raised during a recent oversight hearing with Treasury Secretary Yellen, it was a senior Democratic member of the committee asking the questions,” Grande noted. “At the end of the day, blue states have insurance regulators, too. And they’re no more interested in having the federal government encroach on their authority, or needlessly raising costs for their constituents, than anyone else.”

With committee passage, the bill can now head to the House floor. The bill has a companion measure in the Senate, where it was introduced with the support of each Republican member on the Senate Banking Committee.

Article Posted: 04.18.24
Last Updated: 04.18.24