USA - Two-tier capital regulation proposed for insurance
Saturday, 06 04 2016, Category: Insurance and Reinsurance, Country: United States
Major insurers American International Group Inc and Prudential Financial Inc would be required to hold enough capital to head off risks to the U.S. financial system as part of a regulatory shakeup of the insurance industry proposed by the Federal Reserve on Friday.
The U.S. central bank gained regulatory authority over the two systemically important insurance companies and 12 insurance firms that own banks as a result of the 2010 Dodd-Frank reform law designed to strengthen U.S. oversight of Wall Street.
Under the proposals, insurance firms that own banks will also face a new set of capital standards. Details on capital requirements for the two types of insurers overseen by the Fed have yet to be determined.