Washington D.C. – In a bid to protect the autonomy of state-regulated insurance industries, U.S. Senator Katie Britt (R-Ala.), a member of the Senate Committee on Banking, Housing, and Urban Affairs, spearheads a legislative initiative. The proposed legislation, named the Insurance Data Protection Act, seeks to address concerns surrounding the Federal Insurance Office’s (FIO) recent attempts to extend its influence into the state-regulated insurance sector, notably through the introduction of the “Climate-Related Financial Risk Data Collection.”
The key focus of Senator Britt’s bill is to curtail the FIO Director’s subpoena authority, aligning with the Dodd-Frank Wall Street Reform and Consumer Protection Act’s explicit provision that denies the FIO general supervisory or regulatory powers over the insurance business. The legislation emphasizes that FIO, designed as an informational body, does not require subpoena power and should function collaboratively with state insurance regulators.
Additionally, the proposed bill mandates that FIO coordinates any data collection initiatives with state insurance regulators. It advocates for a comprehensive assessment of publicly available data and sources before seeking additional information, aiming to minimize redundant efforts both at the state and federal levels.
The legislation also outlines stringent confidentiality procedures and requirements governing the use of collected data by financial regulators. This provision is crucial to ensuring the security of consumers’ sensitive information.
Senator Britt underscores the importance of collaboration with state insurance regulators, emphasizing that FIO should work in tandem with them rather than bypassing their authority. She contends that FIO’s recent actions not only exceed its lawful mandate but also leverage private insurance data to advance specific policy agendas.
The bill has garnered significant bipartisan support, with 16 Senate colleagues joining Senator Britt in introducing the legislation. Notable cosponsors include Senate Banking Committee Ranking Member Tim Scott (R-S.C.) and U.S. Senators Marsha Blackburn (R-Tenn.), John Boozman (R-Ark.), Ted Budd (R-N.C.), Tom Cotton (R-Ark.), and others.
Acknowledging the endorsement of the National Association of Mutual Insurance Companies (NAMIC), American Property Casualty Insurance Association (APCIA), Association for Independent Agents (Big I), and Professional Insurance Agents (PIA), Senator Britt highlights the broad industry support for the proposed measures.
The backdrop to this legislative effort involves concerns over FIO’s recent foray into the state-regulated insurance industry, notably the proposed “Climate-Related Financial Risk Data Collection.” This initiative, prompted by the President’s climate executive order, aims to gather detailed data from private insurance companies, a move criticized as costly, onerous, and duplicative.
