In a letter to U.S. members of the Steering Committee of the Financial Stability Board (FSB), the National Association of Insurance Commissioners (NAIC) requested support for strengthening U.S. participation on the board by allowing regulatory input and expertise in discussions that impact U.S. insurance markets and policyholders.
The letter was addressed to Daniel K. Tarullo, Governor of the Federal Reserve Board; Mary Jo White, Chair of the Securities and Exchange Commission; and Marisa Lago, Assistant Secretary, Department of the Treasury.
"As the FSB is increasingly driving international standard-setting beyond its primary focus on financial stability, its work has the potential to impact the U.S. insurance sector," said Adam Hamm, NAIC President and North Dakota Insurance Commissioner. "We are seeking to strengthen U.S. participation in the FSB by directly providing our insurance expertise and regulatory perspective to these important discussions that will have import for the companies we regulate."
To illustrate the far-reaching implications of FSB discussions as they relate to regulated companies, insurance consumers and the financial system in general, the NAIC highlighted how the U.S. insurance market represents one third of the total insurance market worldwide.
"If FSB proposals are to be relevant and considered for integration into the U.S. regulatory regime where appropriate, then U.S. participation in FSB discussions should reflect our unique regulatory structure and not be hampered by arbitrary limitations and seat assignments that place the U.S. at a disadvantage relative to more consolidated regulatory regimes," continued Hamm.
The letter also pointed to examples of FSB working groups that directly impact insurance regulation, such as the Standing Committee on Supervisory and Regulatory Cooperation, which deals with systemic risk and group supervision issues, and the Insurance Cross Border Crisis Management Group under the Resolution Steering Group.