Things to Learn About the Federal Insurance Office
by Ed Snaneh, Agent for Auto Insurance in Chicago Illinois

4717 N Pulaski Road, Chicago Illinois 60630

President Obama under the 2010’s Dodd-Frank Wall Street Reform Act, has created a new federal agency known as the Federal Insurance Office (FIO), basically to watch insurance companies and to present data to Congress on issues related to reforming the financial markets. The new Federal Insurance Office FIO will have no authoritative powers.

The objectives of the Federal Insurance Office include the following:
  • Advises the US Treasury on major federal and international insurance policy issues.
  • Monitors all facets  of the insurance industry, including the availability of affordable insurance to the underserved localities and insurance shoppers.
  • Assists in the administration of the Terrorism Risk Insurance Act.

US Congress provided the Federal Insurance Office with the power to diagnose matters and gaps in the insurance legislative bodies, or issues that may contribute to a systemic crisis in the insurance industry. The Federal Insurance Office will  make recommendations to the Financial Stability Oversight Council pertaining regarding certain  insurance companies that should be subject to supervision of the Federal Reserve's Board of Governors.

The initial objectives of the FIO would be to expand federal level knowledge of state-related insurance legislative.  At the present time state insurance offices are the main legislators for the insurance industry for more than a hundred year. Recently FIO Chairman, Michael McRaith made statements to reassure state legislators that his office is not and cannot be a full-fledged insurance regulatory body. The latest statements of McRaith were made in  front of the House Financial Services Subcommittee on Insurance.  

However, Mr. McRaith evaded answering the question of whether or not the 'Consumer Financial Protection Bureau' should be granted authority over insurance issues by stating that it would 'inappropriate for me to comment at this time.' Also a product of massive legislative response to the financial meltdown of 2008, will police the market for money on behalf of savers and borrowers. The Bureau, part of the of the 2010 Dodd-Frank Wall Street Reform Act,  is believed to have future plan to extend its power to a wide range of financial services, beyond mortgages and real estate to include credit and debit cards, consumer loans on cars, payday loans, credit reporting agencies, debt collectors agents and other financial advisory services, to mention a few.

Jimi Grande, one of the senior vice presidents of the National Association of Mutual Insurance Companies (NAMIC) welcomed Mr. McRaith remarks stating that Mr.  McRaith's statements indicate  that he has an understanding of the role the Federal Insurance Office was created to fill.

Illinois Connection

Michael McRaith is the former chairman of the Illinois Department of Insurance. Mr. McRaith stated  that the Illinois Department  of Insurance is 'responsible for highly technical solvency regulation as well as direct interaction with both business and individual insurance consumers,' according to an interview with the US Treasury.
Posted 2:28 AM  View Comments

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