State insurance regulators would continue to regulate the nation’s insurance industry rather than the Consumer Financial Protection Bureau (CFPB) under new legislation proposed by U.S. Rep. Bryan Steil (R-WI).
“State insurance regulators have a strong track record of effective regulation of the insurance industry,” Rep. Steil said. “It’s time for the bureau to start operating within the boundaries set by Congress, and this bill is a step forward in making sure it does.”
The Business of Insurance Regulatory Reform Act, H.R. 7000, which Rep. Steil sponsored on Jan. 16, would clarify that the CFPB cannot exercise its authority over entities that are engaged in the business of insurance, regardless of whether those entities offer products or services that are subject to other consumer financial protection laws, according to a bill summary provided by the congressman’s staff.
“When Congress created the CFPB, it excluded the insurance business from the bureau’s mandate,” said Rep. Steil. “Unfortunately, the CFPB has tried to expand its authority without any accountability. This legislation makes it clear to the CFPB that it has no authority to regulate the business of insurance.”
Companion legislation was introduced by U.S. Sens. Tim Scott (R-SC) and Joe Manchin (D-WV) and has been endorsed by several entities, including the American Council of Life Insurers, the Consumer Credit Industry Association, the National Association of Insurance and Financial Advisors, and the United States Chamber of Commerce, among many others.