The Treasury Department last night told insurers that they have been ruled eligible for assistance under the Troubled Asset Relief Program if they have a federal regulatory link, such as a thrift charter or a bank holding company charter.
Members of the American Council of Life Insurers, Washington, have asked the Treasury Department for a chance to participate in the program.
Insurers that are members of the American Insurance Association, Washington, say they do not need to participate.
An ACLI spokesman has declined to comment on the latest news about TARP.
The announcement that insurers with thrift or bank charters can participate in TARP “is a positive step, although a small one,” says Scott Talbott, a senior vice president at the Financial Services Roundtable, Washington.
A Treasury Department spokesperson says insurers wishing to participate in TARP can apply for bank or thrift charters at the same time that they apply for TARP aid.
William Ruberry, a spokesman for the Office of Thrift Supervision, says there have been “expressions of potential interest in a thrift charter expressed by several” insurers over the last several days, “but no formal applications at this point.”
About 15 insurers already have thrift or thrift holding company charters, Ruberry says.
Jennifer Zuccarelli, a Treasury spokeswoman, says the latest statement means insurers without any established federal regulatory oversight mechanism have been ruled out of participation in the program.
New York Life Insurance Company, New York, today said it has decided not to participate in TARP.
Representatives for several other life insurers declined to comment on whether their companies will participate in TARP.