Defense Base Act Compensation Blog

The Modern Day DBA Casualty

P&C Insurers Seek Exemption From Federal Oversight

Posted by defensebaseactcomp on March 22, 2010

ACE, Chubb, CNA, Zurich, all DBA insurers,want exemption from Federal Oversight !!!

WR Berkley is applying to be approved to sell DBA

NU Online News Service, March 19, 2:07 p.m. EDT

P and C National Underwriter

WASHINGTON—Ten large property and casualty insurers today asked leadership of the Senate Banking Committee to exempt the industry from federal oversight in financial services reform legislation that will be marked up starting Monday.

In a letter to the committee, the 10 insurers, calling themselves the Property & Casualty Leaders Coalition, said they oppose “misdirected” provisions of the legislation “that would shift the cost of failures of financial institutions outside of our sector to our customers.”

They are talking about a provision of the legislation proposed Monday by Sen. Chris Dodd, D-Conn., that would make insurers and other large, complex financial services companies subject to oversight by the Federal Reserve Board and a new Financial Stability Oversight Council.

Under the bill proposed by Sen. Dodd, federal oversight, in addition to current state oversight, would be applied to nonbank financial companies—determined by a two-thirds majority vote of the Financial Stability Oversight Council—to be subject to prudential supervision by the Board of Governors of the Federal Reserve System. The reason is that “material financial distress” at the company “would pose a threat to the financial stability of the United States.”

The House financial services reform legislation passed last December contains a similar provision. Both bills would also create an Office of National Insurance.

The latest letter was written by the new Coalition to Sen. Dodd and Sen. Richard Shelby, R-Ala., the ranking minority member of the committee.

The companies signing the letter were the Ace Group; Allstate; Chubb; CNA; Liberty Mutual; Nationwide Insurance; State Farm; Travelers; W.R. Berkley Corporation; and Zurich Financial Group.  Full Story here

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