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NATIONAL HARBOR, Md. (Nov 29, 2012) — The National Association of Insurance Commissioners (NAIC) today raised concerns regarding the proposed application of “one size fits all” capital rules on thrift and bank holding companies predominately engaged in insurance activities.  NAIC President and Florida Insurance Commissioner Kevin M. McCarty testified on behalf of U.S. insurance regulators before a joint subcommittee hearing of the House Financial Services Committee.

“The prospect of bank-centric regulatory rules being imposed on insurance groups is problematic,” stated McCarty. “It is critical that the regulatory walls around legal entity insurers that have successfully protected policyholders for decades not be jeopardized.”

The NAIC has submitted comments to the Federal Reserve, Federal Deposit Insurance Corporation and Office of the Comptroller of the Currency on proposed capital requirements to be applied to thrift and bank holding companies. McCarty's testimony reinforced that dependence on capital standards at the expense of other regulatory tools will not sufficiently prevent companies from taking excessive risks.

“We fear the same overreliance on capital could become a reality in our sector, with no diversity of regulation to mitigate the wrong incentives or prevent systemic risk taking.  The existence of global capital standards in the banking sector did not prevent the last crisis and did little to prevent large institutions from becoming larger while chasing each other off their own fiscal cliff,” testified McCarty.

The hearing, titled “Examining the Impact of the Proposed Rules to Implement Basel III Capital Standards” was an opportunity for financial regulators to address concerns with the proposed rules. The subcommittee heard testimony from a number of financial regulators in addition to McCarty. A second panel included industry representatives who would be impacted by the proposed rules.

Click HERE for the full text of the testimony.

Click HERE for the NAIC comment letter.

Click HERE for more information on the Government Relations Leadership Committee.

About the NAIC

The National Association of Insurance Commissioners (NAIC) is the U.S. standard-setting and regulatory support organization created and governed by the chief insurance regulators from the 50 states, the District of Columbia and five U.S. territories. Through the NAIC, state insurance regulators establish standards and best practices, conduct peer review, and coordinate their regulatory oversight. NAIC staff supports these efforts and represents the collective views of state regulators domestically and internationally. NAIC members, together with the central resources of the NAIC, form the national system of state-based insurance regulation in the U.S. For more information, visit



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