The new financial regulatory office that's flying under the radar
There isn't quite the same level of attention being paid to which person Treasury Secretary Tim Geithner will appoint to run the new Federal Insurance Office compared to, say, the Consumer Financial Protection Agency.
But the insurance industry is closely watching this post, which was created by the new financial regulatory laws. Insurance companies are primarily regulated on the state level. The FIO doesn't change that, but it is the first-ever office in the federal government that will focus on insurers. It'll sit in the Treasury and monitor the insurance industry for systemic risk. The office will also gather information about access to products by minorities and low-income communities.
The industry largely supported the bill's creation of the FIO but it does have ideas about what kind of person should run it.
In a letter sent to the Treasury on Wednesday, the industry's biggest trade groups said:
It is important that the FIO Director have the experience and stature necessary to carry out the portfolio that Congress has enumerated for the FIO ... This includes representing the U.S. internationally, preparing and presenting to the Congress important reports on the health and regulation of the industry, and working with senior executives in the industry and regulatory community in furtherance of the goal of becoming the federal government's warehouse of knowledge on all important aspects of the industry.
Who will it be? One lead contender, according to an industry representative I spoke with, is Michael McRaith, director of the Illinois Department of Insurance. Another name in the mix is Terry Vaughan, chief executive of the National Association of Insurance Commissioners. The Treasury press office declined to provide an update Thursday on where the process stands.
Jia Lynn Yang
August 5, 2010; 6:20 PM ET
Categories: Financial regulation , Insurers
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