A bill designed to ensure that insurance savings and loan holding companies are regulated by the states, and not federal authorities, was introduced in the U.S. House of Representatives this week.
The State Insurance Regulatory Preservation Act (H.R. 5059), introduced by Reps. Keith Rothfus (R-PA) and Joyce Beatty (D-OH), applies to insurance savings and loan holding companies (ISLHCs) that meet applicable state and federal capital standards.
The Dodd-Frank Act brought ISLHCs under the supervision of the Federal Reserve. This was a departure from the historical norm and created an unnecessary duplication of effort.
This legislation makes it so that state regulators are responsible for day-to-day supervision. However, it preserves the ability of the Federal Reserve to take a more active role in case ISLHCs fail to adhere to the requirements of the bill.
This legislation does not include thrifts, which would continue to be regulated by the Office of the Comptroller of the Currency (OCC).
“This common-sense regulatory reform bill will ensure that federal and state regulators complement each other’s efforts,” Rothfus said. “The current system of duplicative supervision is inefficient and creates added and unnecessary costs that hinder growth and hurt consumers. I am thankful that my Democratic colleague, Congresswoman Joyce Beatty, has joined me in this important effort.”