H.R. 7130 — McCarran-Ferguson Restoration Act

This section eliminates the Federal Insurance Office (FIO) in the Department of the Treasury and the position of Director of the FIO. (As background, the FIO—established by the Dodd-Frank Act—monitors the U.S. insurance sector for systemic risks, advises the Treasury Secretary on insurance policy, and represents the United States in international insurance forums.) This section does not limit the Secretary of the Treasury's authority relating to insurance matters.

This section establishes the United States Insurance Representative (replacing the Federal Insurance Office) within the Department of the Treasury and directs the Secretary of the Treasury to appoint such Representative, along with expert staff, not later than one year after enactment. The Representative must (1) coordinate federal efforts and policy on prudential aspects of international insurance; (2) represent Treasury in the International Association of Insurance Supervisors; (3) assist in negotiating and administering covered agreements (i.e., international agreements on prudential insurance matters); (4) determine whether state insurance measures are preempted by such agreements; (5) assist in administering the Terrorism Risk Insurance Program; (6) consult with states on insurance matters of national or international importance; and (7) advise the Secretary on global prudential insurance policy. The Representative's authority covers prudential aspects of all U.S. insurance lines except health insurance, long-term care insurance (except when bundled with life or annuity products), and crop insurance. This section further authorizes the Representative to preempt state insurance measures that (1) treat non-U.S. insurers domiciled in foreign jurisdictions subject to a covered agreement less favorably than comparable U.S. insurers and (2) are inconsistent with the agreement, subject to notice-and-comment procedures (including Federal Register notices, state and USTR consultations, and public comment periods), a minimum 30-day delayed effective date, Administrative Procedure Act review, and de novo judicial review; preempted measures may not be enforced by states. The Secretary may issue implementing regulations.

This section replaces references to the Federal Insurance Office in the Dodd-Frank Act and the Economic Growth, Regulatory Relief, and Consumer Protection Act as follows: (1) in two provisions of Dodd-Frank Act section 165(i), with the Secretary of the Treasury; (2) in Dodd-Frank Act section 203(a)(1)(C), references to the Director of the Federal Insurance Office with the United States Insurance Representative; and (3) in section 211(a) paragraphs (1) and (2) of the Economic Growth, Regulatory Relief, and Consumer Protection Act, with the Secretary of the Treasury and the Board of Governors of the Federal Reserve System.

This section revises the membership of the Financial Stability Oversight Council (FSOC)—which identifies risks to U.S. financial stability, responds to emerging threats, and promotes enhanced regulation and supervision—by (1) adding as a voting member a State insurance commissioner appointed by the President, by and with the advice and consent of the Senate, after requesting (but not bound by) recommendations from the National Association of Insurance Commissioners; (2) redesignating the Director of the Federal Insurance Office as the "United States Insurance Representative" as a nonvoting member; and (3) eliminating the nonvoting State insurance commissioner position previously designated by State insurance commissioners. The section sets the new State insurance commissioner's term at 4 years and makes conforming changes to term references (excluding it from the prior 2-year terms for certain State designees); authorizes an acting State insurance commissioner, selected by the National Association of Insurance Commissioners, to serve during vacancies, absences, or disabilities; and permits a holdover service for up to 18 months (or until a successor is confirmed) if no timely replacement. The section also amends FSOC support provisions in section 112 of the Dodd-Frank Act (12 U.S.C. 5322) by removing references to the Federal Insurance Office.