Policyholder Protection Act of 2015

1/11/2023, 1:28 PM

Policyholder Protection Act of 2015

This bill amends the Federal Deposit Insurance Act to declare that any action of the Federal Deposit Insurance Corporation (FDIC) that requires a bank holding company to provide funds or other assets to a subsidiary depository institution is neither effective nor enforceable with respect to a savings and loan holding company that is also an insurance company, an affiliate of an insured depository institution that is an insurance company, or any other company that is an insurance company and directly or indirectly controls an insured depository institution (entities) if:

  • such funds or assets are to be provided by the entity, and
  • the relevant state insurance authority determines that such an action would have a materially adverse effect on the entity's financial condition.

The bill declares that requiring a bank holding company that is an insurance company to serve as a source of financial strength shall be deemed the kind of action of the Board of Governors of the Federal Reserve System that requires a bank holding company to provide funds or other assets to a subsidiary depository institution for specified purposes of the Bank Holding Company Act of 1956.

The Dodd-Frank Wall Street Reform and Consumer Protection Act is amended, with respect to systemic risk determination and the treatment of insurance companies and their subsidiaries, to authorize the FDIC to stand in the place of the appropriate regulatory agency and file a judicial action to place such companies into orderly rehabilitation under state law if the appropriate regulatory agency has not done so.

The FDIC, when funding the orderly liquidation of an insurance company or its subsidiary, shall notify the relevant state insurance authority promptly of its intention to take a lien on the company's assets.

The FDIC may not take such a lien, however, if the state insurance authority informs it that doing so would have a materially adverse effect upon the insurance company's policyholders.

Congress
114

Number
HR - 1478

Introduced on
2015-03-19

# Amendments
0

Sponsors
+5

Cosponsors
+5

Variations and Revisions

11/17/2015

Status of Legislation

Bill Introduced
Introduced to House
House to Vote
Introduced to Senate
Senate to Vote

Purpose and Summary

Policyholder Protection Act of 2015

This bill amends the Federal Deposit Insurance Act to declare that any action of the Federal Deposit Insurance Corporation (FDIC) that requires a bank holding company to provide funds or other assets to a subsidiary depository institution is neither effective nor enforceable with respect to a savings and loan holding company that is also an insurance company, an affiliate of an insured depository institution that is an insurance company, or any other company that is an insurance company and directly or indirectly controls an insured depository institution (entities) if:

  • such funds or assets are to be provided by the entity, and
  • the relevant state insurance authority determines that such an action would have a materially adverse effect on the entity's financial condition.

The bill declares that requiring a bank holding company that is an insurance company to serve as a source of financial strength shall be deemed the kind of action of the Board of Governors of the Federal Reserve System that requires a bank holding company to provide funds or other assets to a subsidiary depository institution for specified purposes of the Bank Holding Company Act of 1956.

The Dodd-Frank Wall Street Reform and Consumer Protection Act is amended, with respect to systemic risk determination and the treatment of insurance companies and their subsidiaries, to authorize the FDIC to stand in the place of the appropriate regulatory agency and file a judicial action to place such companies into orderly rehabilitation under state law if the appropriate regulatory agency has not done so.

The FDIC, when funding the orderly liquidation of an insurance company or its subsidiary, shall notify the relevant state insurance authority promptly of its intention to take a lien on the company's assets.

The FDIC may not take such a lien, however, if the state insurance authority informs it that doing so would have a materially adverse effect upon the insurance company's policyholders.

Alternative Names
Official Title as IntroducedTo provide for notice to, and input by, State insurance commissioners when requiring an insurance company to serve as a source of financial strength or when the Federal Deposit Insurance Corporation places a lien against an insurance company's assets, and for other purposes.

Policy Areas
Finance and Financial Sector

Potential Impact
Administrative law and regulatory procedures•
Bank accounts, deposits, capital•
Banking and financial institutions regulation•
Bankruptcy•
Federal Reserve System•
Financial crises and stabilization•
Insurance industry and regulation

Comments

Recent Activity

Latest Summary3/28/2016

Policyholder Protection Act of 2015

This bill amends the Federal Deposit Insurance Act to declare that any action of the Federal Deposit Insurance Corporation (FDIC) that requires a bank holding company to provide funds or other ass...


Latest Action11/17/2015
Received in the Senate and Read twice and referred to the Committee on Banking, Housing, and Urban Affairs.