WASHINGTON — Nat Wienecke, senior vice president of federal government relations at the Property Casualty Insurers Association of America (PCI) issued the following statement encouraging the House to pass H.R. 4061, the Financial Stability Oversight Council (FSOC) Improvement Act. The bill was reported out of the House Financial Services Committee in January on a strong bipartisan vote of 45-10.
H.R. 4061 would require FSOC, upon considering a company for systemic risk designation, to provide the company with notice setting forth “with specificity the basis for so identifying the company.” A company would then have the opportunity to comment and/or develop a plan to modify its business, structure, and operations to mitigate the systemic risk FSOC has identified.
“The overwhelming consensus among insurance experts is that traditional Insurance activities are not systemically risky. But in the past, that has not stopped FSOC from designating some insurers as systemically risky and then refusing to provide a clear path toward de-designation.
“PCI has long-argued for a clear off-ramp for companies to take action to eliminate activities that FSOC believes pose systemic risk. When FSOC fails to provide an off-ramp, it causes Dodd-Frank to fail in its mission to eliminate perceived systemic threats to the economy. This bipartisan bill is a solution.
“PCI commends Representatives Ross and Delaney for introducing this important legislation. We urge the House to pass the Financial Stability Oversight Council Improvement Act and work with the Senate on final legislation to send to the president expeditiously.”
PCI’s letter of support is attached.