Brookings: Regulating Insurance After the Crisis

by Sabrina I. Pacifici on March 4, 2009

Regulating Insurance After the Crisis, Robert E. Litan, Senior Fellow, Economic Studies, The Brookings Institution, March 4, 2009

  • “Despite a long-standing policy debate, insurance remains the only major financial industry not to be regulated at the federal level, a tradition dating from the 19th century. However, recent financial turmoil has fundamentally changed the terms of this important discussion…[the author] conclude[s] in this essay that insurers and agents operating in multiple states should have the option to operate under a more streamlined regulatory system, and in particular to choose between being chartered and thus regulated by individual state regulators, or by a new federal insurance regulator. Congress has considered but not yet enacted legislation establishing this “optional federal charter” system, analogous (although not identical) to the regulatory system that has long governed the U.S. banking industry.”
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