These comments were submitted in November 2011 by R Street President Eli Lehrer and Public Affairs Director R.J. Lehmann to the U.S. Treasury Department’s Federal Insurance Office in response to FIO Director Michael McRaith’s call for recommendations to improve the U.S. state-based system of insurance regulation. In the paper, the pair argue that traditional property and casualty insurance is not a source of systemic risk; that the federal government should, however, monitor the potential risks posed by the growth of very large residual market mechanisms; that proposals for federal insurance regulation should be subjected to significant scrutiny; that more measured federal interventions, such as ensuring states permit risk-based pricing, could be viable alternatives, but must be considered on a case-by-case basis; and that the FIO should make freely available to the public non-confidential statutory insurance data reported to it by the states or the National Association of Insurance Commissioners.

Featured Publications