The American Council of Life Insurers is celebrating the signing of one federal bill it likes, and hoping Congress will follow up on that by passing a bill that will replace the U.S. Department of Labor’s fiduciary rule.
The Washington-based group today put out one statement welcoming the arrival of the Protecting Advice for Small Savers Act of 2017 bill. The ACLI also put out another statement welcoming the signing of H.R. 3110, the Financial Stability Oversight Council Insurance Member Continuity Act bill, by President Donald Trump
The Protecting Advice for Small Savers bill, which does not yet have a bill number, would establish a new standard of conduct for broker-dealers.
The new law based on H.R. 3110 is supposed to increase the odds that the Financial Stability Oversight Council, an agency that helps the federal government monitor and manage potential sources of systemic risk, always has a member who understands insurance.
The ACLI notes in a statement about H.R. 3110 that Republicans and Democrats worked together to pass it: Sen. Mike Crapo, R-Idaho, joined with Sen. Sherrod Brown, D-Ohio, to get the bill through the Senate, and Rep. Randy Hultgren, R-Ill., joined with Rep. Maxine Waters, D-Calif., to get the bill through the House.
Thanks to that bipartisan effort, Congress “showed overwhelming support for the measure,” according to ACLI President Dirk Kempthorne.
Rep. Ann Wagner, R-Mo., the sponsor of the standard-of-conduct bill, wants to replace the U.S. Department of Labor’s fiduciary rule with a new standard.
The new standard would be administered by the U. S. Securities and Exchange Commission, rather than the DOL.
The bill would encourage state insurance regulators to establish a similar standard for life insurance agents and brokers who sell annuities.
Most FSOC members are the heads of federal agencies. When heads of federal agencies leave, their successors fill their FSOC seats.
Because no federal agency regulates insurance, the president has to appoint the FSOC member who advises the council on insurance.
In theory, the seat for the “independent member with insurance expertise” could stay vacant for months, or years, while a president is vetting the nominee for that seat, or the Senate is waiting to vote on the nominee.
H.R. 3110 helps avoid FSOC insurance member seat gaps, by letting the member with insurance expertise stay on the council until a successor is confirmed, or for 18 months, if confirming a successor takes more than 18 months.
The current incumbent is S. Roy Woodall Jr., a former Kentucky insurance commissioner. His term expires Saturday.
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