Faegre Baker Daniels and FaegreBD Consulting were pleased to partner again with Networks Financial Institute (NFI) and the Scott College of Business at Indiana State University in presenting the 11th Annual Insurance Public Policy Summit in Washington, D.C. on March 17, 2015. This year's Summit focused on the impact that domestic and international insurance regulations have on the industry in the United States and around the world.
In addition to the remarks from speakers and engaging panel discussions, research panelists presented four policy briefs that discuss their recent research on insurance regulation in the post-Dodd-Frank world. All research presented is available on the NFI Summit website.
Below are a few points of interest from each speaker's remarks:
Jack Maynard, Indiana State University Interim Provost and Vice President, and Brien Smith, Dean of Indiana State’s Scott College of Business, welcomed the audience of industry professionals, congressional staff, past and current state regulators, federal officials, academics, and industry stakeholders and commentators. Student Mitchell Wasmund spoke for the NFI Scholars.
Congressman Blaine Luetkemeyer (R-MO), Chairman of the House Financial Services Subcommittee on Housing and Insurance:
- Gave an update on the Subcommittee’s priorities related to insurance, including FSOC oversight and the designation of Nonbank SIFIs, Capital Standards and Basel III, and monitoring the implementation of Dodd-Frank and its impact on the insurance sector.
- Discussed the importance of U.S. involvement in the shaping of international capital and other standards and cautioned against “one-size fits all” international regulation being imposed on the U.S. insurance market.
- Spoke about cybersecurity issues facing our economy.
Senator Joe Donnelly (D-IN), a member of the Senate Banking, Housing & Urban Affairs Committee and its Subcommittee on Securities, Insurance & Investment:
- Gave an overview of Senate priorities and the insurance Subcommittee’s agenda for the current session.
- Discussed possible changes to Dodd-Frank, including capital standards and the Subcommittee’s efforts to limit the regulatory burden on community banks.
- Mentioned the importance of strengthening cybersecurity in the insurance and financial services sector in light of recent cyberattacks.
Federal Insurance Director Michael McRaith:
- Discussed the complexities and increasing role of international insurance regulation and its impact on the U.S. insurance industry and the overall globalization of the U.S. insurance market.
- Gave an overview of FIO’s efforts in shaping CommFrame and Insurance Capital Standards and mentioned that the first iteration of the Insurance Capital Standards will be developed in 2016.
- Outlined FIO and Treasury efforts to enhance cybersecurity within the insurance industry, including the NIST framework and the growing efforts to protect policyholders from cyberattacks.
Federal Reserve Associate Director Thomas Sullivan:
- Gave an in-depth overview of the Federal Reserve’s role in the supervision of insurance holding companies and discussed its participation in the IAIS.
- Assured industry members of the Fed’s continued effort to tailor supervisory framework to the insurance industry.
NAIC Member and Florida Office of Insurance Regulation Commissioner Kevin McCarty:
- Discussed the role of the NAIC and its role in helping “Team USA” create international standards that are appropriate for the U.S. insurance market.
- Argued for the importance of an “exit ramp” for the de-designation of non-bank SIFIs.
- Mentioned that the NAIC is currently crafting recommendations to the President regarding the implementation of NARAB II.
Policy Research Discussion, with Aaron Klein, Director of the Financial Regulatory Reform Initiative, Bipartisan Policy Center; Hester Peirce, Senior Research Fellow, George Mason University Mercatus Center; Karen Shaw Petrou, Co-founder and Managing Partner, Federal Financial Analytics Inc.; and moderated by Peter Gallanis, President, NOLHGA:
- Engaged in a vibrant discussion on the future of domestic and international insurance regulation and discussed the “trickle down” of international regulation and how it may impact the industry in the U.S. and at the state level.
- Identified the regulatory shift from prudential regulation to macro-prudential regulation in the insurance industry.
- Discussed how to enhance the resolvability of insurers both domestically and internationally.
Industry Panel, with Charles Chamness, President and CEO, NAMIC; Dirk Kempthorne, President and CEO, ACLI; Frank Nutter, President, RAA; Leigh Ann Pusey, President and CEO, AIA; David Sampson, President and CEO, PCI; and moderated by Charlie Richardson, Partner and Financial Services Industry Leader, Faegre Baker Daniels:
- Outlined new challenges facing the industry in light of current state, federal and international regulatory regimes.
- Panelists stressed the importance of U.S. input in shaping international insurance regulations.
- Discussed the need for further transparency regarding FSOC’s designation of non-bank Systemically Important Financial Institutions (SIFIs).