The Federal Reserve Board is in charge of bailing financial services companies out if they get in trouble, and it gives each financial services sector a thorough roasting twice a year, in the biennial Financial Stability Report series.
The life and annuity issuers and their regulators contend that bank regulators focus too much on insurers' ability to cope with rare, sudden "runs," or panics that cause customers to rush in to pull cash out.
That's really a bank problem, not a significant problem for life and annuity issuers, life and annuity issuers say. The life and annuity issuers wish the Fed would pay more attention to their need to provide the benefits they promised to provide.
But the Fed's run-centric perspective shapes the insurance sections in the new Financial Stability Report that came out Friday, just as it has shaped the insurance sections in the earlier editions.
For five possible concerns that Fed risk trackers see when they look hard at life and annuity issuers, see the gallery accompanying this article.
Federal Reserve Building. Credit: Shutterstock
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