H.R. 5143, Transparent Insurance Standards Act of 2016

H.R. 5143

Transparent Insurance Standards Act of 2016

December 7, 2016 (114th Congress, 2nd Session)

Staff Contact
John Huston

Floor Situation

On­­­­ Wednesday, December 7, 2016, the House will begin consideration of H.R. 5143, the Transparent Insurance Standards Act of 2016, Rule Committee Print, under a structured rule. H.R. 5143 was introduced on April 29, 2016, by Rep. Blaine Luetkemeyer (R-MO) and was referred to the Committee on Financial Services, which ordered the bill reported by a vote of 34 to 25 on June 16, 2016.

Bill Summary

H.R. 5143 would provide greater transparency and congressional oversight of international insurance standards setting processes, by establishing a series of requirements to be met before the Treasury Department or the Federal Reserve (Fed) may agree to, accept, establish, enter into or consent to the adoption of a final international insurance standard.[1]

Before agreeing to or adopting such standards, the bill would require that the Treasury and the Federal Reserve publish any proposed final standard, allow for public comment, and report to the Congress on the impact of those standards on U.S. consumers, markets, and state laws. The bill also would require the Federal Reserve to promulgate a rule on domestic capital standards before agreeing to any international standard related to capital standards for insurance firms. The bill also ensures that the Financial Stability Oversight Council’s (FSOC) Independent Member with Insurance Expertise is permitted to assist the FSOC in international discussions and attend meetings of international bodies where insurance standards are discussed.

The Rules Committee Print includes an amendment which fully offset CBO’s estimated $7 million cost of H.R. 5143, as reported, by reducing the amount of money that the Securities and Exchange Commission (SEC can deposit in its “Reserve Fund” to a maximum of $43 million for the current fiscal year (FY 17) and directs any amounts that exceed that limitation must be transferred from the SEC to the Treasury General Fund.

[1] See House Report 114-831 at 7.


For nearly 150 years, U.S. insurance companies of every kind— including property-casualty, life, reinsurance, health, and auto have been regulated primarily by the states. Congress and the states have occasionally reviewed the effectiveness of the state-based regulation of insurance and coordinated efforts to achieve greater regulatory uniformity.[1]

The Dodd-Frank Wall Street Reform and Consumer Protection Act enlarged the federal government’s role in the insurance industry by creating a federal office specifically tasked with insurance matters. The Dodd-Frank Act established a Federal Insurance Office (FIO) at Treasury and charged the director of the FIO with representing the interests of U.S. insurers during the negotiation of international agreements and advising the Office of the U.S. Trade Representative (USTR) during trade negotiations.[2]

H.R. 5143 addresses concerns that international negotiations should be consistent with the intent of Congress on international issues to follow a more insurance centric approach for insurance issues, including collaborating with the state insurance regulators and seeking greater equivalent recognition of the U.S. insurance regulatory system internationally. Hence, H.R. 5143 would create a more formalized role for Congressional monitoring of international standards and agreements.[3]

According to the bill sponsor, “I’ve worked with my colleagues to develop legislation that helps to ensure the United States will not only maintain its involvement in international conversations, but will sit at the head of the table. This legislation maintains that international discussions should first and foremost represent the state-based regulatory system and protect American policyholders. The United States has a robust domestic insurance marketplace that puts policyholders first and it is critical that we maintain it.”[4]

[1] Id.
[2] Id.
[3] Id.
[4] See Rep. Luetkemeyer Press Release, “Luetkemeyer Introduces Legislation to Protect America’s Insurance Markets,” May 3, 2016.


The Congressional Budget Office (CBO) estimates enacting the bill, as reported, would increase costs to the Federal Reserve System for conducting the required analysis and for preparing reports and testimony. Those increased costs would reduce revenues paid to the Treasury by the Federal Reserve by $7 million over the 2017-2026 period; therefore pay-as-you-go procedures apply.

However, the Rules Committee Print includes an amendment to the text, as introduced, to fully offset the cost of the legislation by reducing the amount of money the SEC may hold in its reserve account and requiring excess balances to be transferred to the Treasury General Fund.


  1. Ron DeSantis (R-FL)—This amendment adds an additional requirement that the international agreement must be written in plain writing, as defined by the Plain Writing Act of 2010.

Additional Information

For questions or further information please contact John Huston with the House Republican Policy Committee by email or at 6-5539.