The Obama administration is again postponing release of a report outlining proposals for modernizing insurance regulation that was scheduled to be released last January.
Disclosure of the delay was contained in comments Federal Insurance Office director Michael McRaith is scheduled to make before a House Services Committee panel Thursday and as it released its annual report on the industry.
In his comments, McRaith is scheduled to say that the FIO will release “additional reports this year,” including the report on how to modernize and improve the system of insurance regulation in the U.S.
A separate report on the “breadth, scope and role of the global reinsurance market” will also be released, McRaith is scheduled to say.
The first FIO report merely recites industry facts and figures — and does not make any controversial observations as to how the industry should be regulated in the future.
The report said the key industry issues are the low interest rate environment; natural catastrophes, and their impact “on individuals, families, businesses, and communities”; the changing demographics in the United States, where the aging of the U.S. population, combined with increased life expectancy, has increased demand for products that offer lifetime income protection; and growth opportunities in emerging markets.
The report was released on the eve of a congressional hearing that may underscore tensions between the FIO and the National Association of Insurance Commissioners (NAIC).
The title of the hearing is, “The Impact of International Regulatory Standards on the Competitiveness of U.S. Insurers.”
FIO director Michael McRaith, NAIC CEO Ben Nelson, and Roy Woodall, an independent member of the Financial Stability Oversight Council, will testify.
The hearing is being held by the Housing and Insurance Subcommittee of the Financial Services Committee.
The hearing was demanded by state regulators who have complained that the FIO, since its enactment, is attempting to usurp the primacy of state insurance regulation with respect to international negotiations.
In a flash report to its members obtained by the National Underwriter, the Council of Insurance Agents and Brokers (CIAB) said that, “The actual scholarly and balanced nature of the report, meanwhile, may be seen as somewhat anticlimactic.”
At the same time, Joel Wood, CIAB senior vice president of government affairs, said in the memo to members that, “At first blush, the report looks to us to be an accurate and relevant document that puts into context the industry’s financial strength and regulation.”
In a separate statement, the National Association of Mutual Insurance Companies (NAMIC) said that the report “shows the continued strength of the property/casualty insurance industry despite the financial crisis and some of the worst years for natural catastrophes on record.”