The Federal Insurance Office (FIO) was established under the Dodd-Frank financial reform act. The office monitors the insurance industry in the United States and identifies regulatory gaps that could lead to a systemic financial crisis. It also examines the affordability of insurance products for the public and minorities. The FIO does not make rules or regulations, but instead collects data about the industry and coordinates federal efforts. The office also develops policy on international insurance matters.
The FIO has the power to request information from insurers. However, it can only do so in exceptional cases. It must first write a finding that the information requested is necessary for the FIO to perform its statutory functions. The data sought must also not be available through public sources or from insurance regulatory agencies.
The Federal Insurance Office is an independent federal agency that advises the Secretary of the Treasury on issues related to the insurance industry. It also advises the Treasury Department and engages in international discussions related to insurance. Its authorities are not intended to replace state insurance regulatory authorities, which are still the primary regulatory agencies for the insurance industry.
The FIO collects information about the insurance industry through information sharing agreements with state regulators and can also require insurers to provide the data themselves. Small insurers do not need to provide data, however, as the law allows an exemption. Small insurers must meet certain size requirements to qualify. Small insurers should consult with their state insurance regulators to determine whether this rule applies to them.
The FIO is also committed to regulating the broadest range of insurance products available. It will also work to enhance the insurance sector’s engagement with climate change. This initiative will help the government meet its climate goals, while ensuring that insurance costs are reasonable. However, there are many challenges facing the insurance industry.
The FIO should also evaluate the Executive Order action items to address climate-related issues, gaps in insurer supervision, and the risks of major disruptions to private insurance coverage in vulnerable areas. The office should also consult with states to determine the extent to which insurers are meeting their climate goals. Its actions should be consistent with the President’s climate change agenda. It is important to maintain state-level insurance regulation and prevent federal encroachment on the insurance market.
The FIO is seeking public input on climate-related financial risk. It wants to determine how to respond to the Executive Order and to coordinate with the Treasury Department’s Climate Hub. It will also collect data that will inform its future work. The office will consider any suggestions submitted for its next steps. And it is not too late to get involved.
