Senate Committee on Banking, Housing, and Urban Affairs Chairman Sherrod Brown (D-OH) has forwarded correspondence to two entities regarding concerns about private equity’s insurance industry role.
Brown’s letter to Director of the Treasury Federal Insurance Office Steven Seitz and National Association of Insurance Commissioners (NAIC) President Dean Cameron includes a requested report to Congress no later than May 31, 2022.
“I am writing to express my concern that insurance investment products workers depend on for their retirement are being transferred to these risky companies that have a track record of undermining pension and retirement programs,” Brown wrote. “In FIO’s (Federal Insurance Office) most recent report, you pointed out these arrangements have become increasingly common over the last decade.”
Brown maintains workers who chose to invest their retirement savings in conservative and long-lived insurance firms presently find themselves paying premiums to riskier firms with less experience in the insurance business.
“While investment firms might benefit from huge profits in the short term, failure to adequately manage these risks may ultimately cost policyholders their retirement incomes,” Brown concluded. “Given the rapid growth of insurance and retirement products held and managed by investment firms and the potential impact on workers, I am requesting that FIO, in consultation with NAIC, work to collect additional data from insurers and then further study this matter.”