by Lawrence H. Mirel, Scott G. Paris
Washington Legal Foundation
February 12, 2014
The recent global financial crisis demonstrated the interdependence of our industrial society. Leaders of the major industrial nations (collectively the G-20) have agreed to establish tough solvency standards and to hold the largest international financial institutions to those standards, whether banks, investment companies, insurers, or combinations thereof. However, insurance in the U.S. has always been regulated by the states. As a result, the U.S. Government has struggled to explain to its partners in the G-20 how it can carry out its commitment to enforce international fiscal standards for large multi-national insurance companies. Dodd-Frank, while leaving the states in charge of regulating insurers, contains several exceptions to that general rule. These exceptions give federal officials potential tools to hold large insurers to international solvency standards, and they are already pursuing steps to exploit them.

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