[Congressional Record Volume 164, Number 115 (Tuesday, July 10, 2018)]
[House]
[Pages H6007-H6010]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
INTERNATIONAL INSURANCE STANDARDS ACT OF 2018
Mr. HUIZENGA. Mr. Speaker, I move to suspend the rules and pass the
bill (H.R. 4537) to preserve the State-based system of insurance
regulation and provide greater oversight of and transparency on
international insurance standards setting processes, and for other
purposes, as amended.
The Clerk read the title of the bill.
The text of the bill is as follows:
H.R. 4537
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``International Insurance
Standards Act of 2018''.
SEC. 2. CONGRESSIONAL FINDINGS.
The Congress finds the following:
(1) The State-based system for insurance regulation in the
United States has served American consumers well for more
than 150 years and has fostered an open and competitive
marketplace with a diversity of insurance products to the
benefit of policyholders and consumers.
(2) Protecting policyholders by regulating to ensure an
insurer's ability to pay claims has been the hallmark of the
successful United States system and should be the paramount
objective of domestic prudential regulation and emerging
international standards.
(3) The Dodd-Frank Wall Street Reform and Consumer
Protection Act (Public Law 111-203) reaffirmed the State-
based insurance regulatory system.
SEC. 3. REQUIREMENT THAT INSURANCE STANDARDS REFLECT UNITED
STATES POLICY.
(a) Requirement.--
(1) In general.--Parties representing the Federal
Government in any international regulatory, standard-setting,
or supervisory forum or in any negotiations of any
international agreements relating to the prudential aspects
of insurance shall not agree to, accede to, accept, or
establish any proposed agreement or standard if the proposed
agreement or standard fails to recognize the United States
system of insurance regulation as satisfying such proposals.
(2) Inapplicability.--Paragraph (1) shall not apply to any
forum or negotiations relating to a covered agreement (as
such term is defined in section 313(r) of title 31, United
States Code).
(b) Federal Insurance Office Functions.--Subparagraph (E)
of section 313(c)(1) of title 31, United States Code, is
amended by inserting ``Federal Government'' after ``United
States''.
(c) Negotiations.--Nothing in this section shall be
construed to prevent participation in negotiations of any
proposed agreement or standard.
SEC. 4. STATE INSURANCE REGULATOR INVOLVEMENT IN
INTERNATIONAL STANDARD SETTING.
In developing international insurance standards pursuant to
section 3, and throughout the negotiations of such standards,
parties representing the Federal Government shall, on matters
related to insurance, closely consult, coordinate with, and
seek to include in such meetings State insurance
commissioners or, at the option of the State insurance
commissioners, designees of the insurance commissioners
acting at their direction.
SEC. 5. CONSULTATION WITH CONGRESS.
(a) Requirement.--Parties representing the Federal
Government with respect to any agreement under section 3
shall provide written notice to and consult with the
Committee on Financial Services of the House of
Representatives and the Committee on Banking, Housing, and
Urban Affairs of the Senate, and any other relevant
committees of jurisdiction--
(1) before initiating negotiations to enter into the
agreement, regarding--
(A) the intention of the United States to participate in or
enter into such negotiations; and
(B) the nature and objectives of the negotiations; and
(2) during negotiations to enter into the agreement,
regarding--
(A) the nature and objectives of the negotiations
(B) the implementation of the agreement, including how it
is consistent with and does not materially differ from or
otherwise affect Federal or State laws or regulations;
(C) the impact on the competitiveness of United States
insurers; and
(D) the impact on United States consumers.
(b) Consultation With Federal Advisory Committee on
Insurance.--Before entering into an agreement under section
3, the Secretary of the Treasury shall seek to consult with
the Federal Advisory Committee on Insurance formed pursuant
to section 313(h) of title 31, United States Code.
SEC. 6. REPORT TO CONGRESS ON INTERNATIONAL INSURANCE
AGREEMENTS.
Before entering into an agreement under section 3, parties
representing the Federal Government shall submit to the
appropriate congressional committees and leadership a report
that describes --
(1) the implementation of the agreement, including how it
is consistent with and does not materially differ from or
otherwise affect Federal or State laws or regulations;
(2) the impact on the competitiveness of United States
insurers; and
(3) the impact on United States consumers.
SEC. 7. COVERED AGREEMENTS.
(a) Preemption of State Insurance Measures.--Subsection (f)
of section 313 of title 31, United States Code, is amended by
striking ``Director'' each place such term appears and
inserting ``Secretary''.
(b) Definition.--Paragraph (2) of section 313(r) of title
31, United States Code, is amended--
(1) in subparagraph (A), by striking ``and'' at the end;
(2) in subparagraph (B), by striking the period at the end
and inserting ``; and''; and
(3) by adding at the end the following new subparagraph:
[[Page H6008]]
``(C) applies only on a prospective basis.''.
(c) Consultation; Submission and Layover; Congressional
Review.--Section 314 of title 31, United States Code is
amended--
(1) in subsection (b)--
(A) in paragraph (2)(C), by striking ``laws'' and inserting
the following: ``and Federal law, and the nature of any
changes in the laws of the United States or the
administration of such laws that would be required to carry
out a covered agreement''; and
(B) by adding at the end the following new paragraph:
``(3) Access to negotiating texts and other documents.--
Appropriate congressional committees and staff with proper
security clearances shall be given timely access to United
States negotiating proposals, consolidated draft texts, and
other pertinent documents related to the negotiations,
including classified materials.'';
(2) by redesignating subsection (c) as subsection (d);
(3) by inserting after subsection (b) the following new
subsection:
``(c) Requirements for Consultations With State Insurance
Commissioners.--Throughout the negotiations of a covered
agreement, parties representing the Federal Government shall
closely consult and coordinate with State insurance
commissioners.'';
(4) in subsection (d), as so redesignated by paragraph
(2)--
(A) in the matter preceding paragraph (1), by striking
``only if--'' and inserting the following: ``only if, before
signing the final legal text or otherwise entering into the
agreement--'';
(B) in paragraph (1), by striking ``congressional
committees specified in subsection (b)(1)'' and inserting
``appropriate congressional committees and leadership and to
congressional committee staff with proper security
clearances''; and
(C) by striking paragraph (2) and inserting the following
new paragraph:
``(2)(A) the 90-day period beginning on the date on which
the copy of the final legal text of the agreement is
submitted under paragraph (1) to the congressional
committees, leadership, and staff has expired; and
``(B) the covered agreement has not been prevented from
taking effect pursuant to subsection (e).''; and
(5) by adding at the end the following new subsections:
``(e) Period for Review by Congress.--
``(1) In general.--During the layover period referred to in
subsection (d)(2)(A), the Committees on Banking, Housing, and
Urban Affairs and Finance of the Senate and the Committees on
Financial Services and Ways of Means of the House of
Representatives should, as appropriate, exercise their full
oversight responsibility.
``(2) Effect of enactment of a joint resolution of
disapproval.--Notwithstanding any other provision of law, if
a joint resolution of disapproval relating to a covered
agreement submitted under subsection (d)(1) is enacted in
accordance with subsection (f), the covered agreement shall
not enter into force with respect to the United States.
``(f) Joint Resolutions of Disapproval.--
``(1) Definition.--In this subsection, the term `joint
resolution of disapproval' means, with respect to proposed
covered agreement, only a joint resolution of either House of
Congress--
``(A) that is introduced during the 90-day period referred
to in subsection (d)(2)(A) relating to such proposed covered
agreement;
``(B) which does not have a preamble;
``(C) the title of which is as follows: `A joint resolution
disapproving a certain proposed covered agreement under
section 314 of title 31, United States Code.'; and
``(D) the sole matter after the resolving clause of which
is the following: `Congress disapproves of the proposed
covered agreement submitted to Congress under section 314
(c)(1) of title 31, United States Code, on _______ relating
to ________.', with the first blank space being filled with
the appropriate date and the second blank space being filled
with a short description of the proposed covered agreement.
``(2) Introduction.--During the layover period referred to
in subsection (d)(2)(A), a joint resolution of disapproval
may be introduced--
``(A) in the House of Representatives, by any Member of the
House, and
``(B) in the Senate, by any Senator,
and shall be referred to the appropriate committees.
``(3) Rules of house of representatives and senate.--This
subsection is enacted by Congress--
``(A) as an exercise of the rulemaking power of the Senate
and the House of Representatives, respectively, and as such
is deemed a part of the rules of each House, respectively,
and supersedes other rules only to the extent that it is
inconsistent with such rules; and
``(B) with full recognition of the constitutional right of
either House to change the rules (so far as relating to the
procedure of that House) at any time, in the same manner, and
to the same extent as in the case of any other rule of that
House.
``(g) Appropriate Congressional Committees and Leadership
Defined.--In this section, the term `appropriate
congressional committees and leadership' means--
``(1) the Committees on Banking, Housing, and Urban Affairs
and Finance, and the majority and minority leaders, of the
Senate; and
``(2) the Committees on Financial Services and Ways and
Means, and the Speaker, the majority leader, and the minority
leader, of the House of Representatives.''.
SEC. 8. INAPPLICABILITY TO TRADE AGREEMENTS.
This Act and the amendments made by this Act shall not
apply to any forum or negotiations related to a trade
agreement.
The SPEAKER pro tempore. Pursuant to the rule, the gentleman from
Michigan (Mr. Huizenga) and the gentlewoman from California (Ms. Maxine
Waters) each will control 20 minutes.
The Chair recognizes the gentleman from Michigan.
General Leave
Mr. HUIZENGA. Mr. Speaker, I ask unanimous consent that all Members
have 5 legislative days to revise and extend their remarks and to
include any extraneous material on the bill.
The SPEAKER pro tempore. Is there objection to the request of the
gentleman from Michigan?
There was no objection.
Mr. HUIZENGA. Mr. Speaker, I yield myself such time as I may consume.
Mr. Speaker, first I would like to commend my friends, Mr. Duffy and
Mr. Heck, for their work on this very important issue. For over 150
years, U.S. insurance companies of every kind--including property-
casualty, life, reinsurance, health, and auto--have all 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 that
they have to achieve greater regulatory uniformity. In fact, in 1945,
Congress passed the McCarran-Ferguson Act, which confirmed the States'
regulatory authority over insurance except where a Federal law
expressly provides otherwise.
As a former State representative in the Michigan Legislature, I know
firsthand that Michigan does a better job of protecting policyholders
within their borders than the Federal Government can do. I have seen it
in action. Even more, Michigan certainly knows how to maintain a robust
insurance marketplace that works for Michigan consumers. I would assume
the exact same thing in Wisconsin and in Washington and in California
and all throughout the States.
However, there are those who believe Washington knows best. In fact,
title V of the Dodd-Frank 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 FIO, or the
Federal Insurance Office, at the U.S. Department of the Treasury and
charged the FIO Director with the responsibility to both represent the
interests of U.S. insurers during the negotiation of international
agreements and then advise the Office of the United States Trade
Representative during trade negotiations.
At the same time, the Dodd-Frank Act changed domestic insurance
regulation. Dodd-Frank led to changes in the U.S. participation at the
International Association of Insurance Supervisors, also known as IAIS,
which develops international insurance regulations for its 190
jurisdictions in more than 140 countries.
Mr. Speaker, I know that I am not the only one who is concerned that
this could influence the Federal Government to look at replacing our
State-based regulatory insurance model with some sort of international
standards that were created, frankly, by unelected European
bureaucrats. The outcomes of these discussions could have significant
impact on the U.S. insurance markets, consumers, and the companies that
provide those products.
Therefore, the U.S. needs to maintain a strong, unified voice that
will ensure our successful State-based, policyholder-centric system of
insurance regulation is the model for the discussions and the basis of
the official United States position abroad.
H.R. 4537, the International Insurance Standards Act, introduced by
my friend and colleague, Representative Duffy, would require the United
States to recognize the primacy of the U.S. State-based insurance
regulatory regime when entering into and agreeing to international
insurance negotiations. Additionally, this bill would provide needed
transparency throughout the negotiation process and provide Congress
with final approval authorization.
As the IAIS works on topics like global capital standards,
governance,
[[Page H6009]]
and market conduct, H.R. 4537 would position the U.S. to participate in
the discussions, while also protecting itself from European standards
that could be detrimental to U.S. consumers, insurers, and markets.
Mr. Speaker, I would like to commend, again, Representative Duffy and
Representative Heck for their bipartisan work on this important bill,
which passed the Financial Services Committee on a vote of 56-4. I urge
my colleagues on both sides of the aisle to protect an insurance
regulatory model that has worked well for over 150 years and vote in
favor of H.R. 4537.
Mr. Speaker, I reserve the balance of my time.
Committee on Ways and Means,
House of Representatives,
Washington, DC, June 22, 2018.
Hon. Jeb Hensarling,
Chairman, Committee on Financial Services, Washington, DC.
Dear Chairman Hensarling: I am writing with respect to the
jurisdictional interest of the Committee on Ways and Means in
matters being considered in H.R. 4537, the International
Insurance Standards Act of 2018.
As a result of your having consulted with us on provisions
in H.R. 4537 that fall within the Rule X jurisdiction of the
Committee on Ways and Means, I agree to waive formal
consideration of this bill so that it may move expeditiously
to the floor. The Committee on Ways and Means takes this
action with the mutual understanding that we do not waive any
jurisdiction over the subject matter contained in this or
similar legislation, and the Committee will be appropriately
consulted and involved as the bill or similar legislation
moves forward so that we may address any remaining issues
that fall within our jurisdiction. The Committee also
reserves the right to seek appointment of an appropriate
number of conferees to any House-Senate conference involving
this or similar legislation, and requests your support for
such request.
Finally, I would appreciate your response to this letter
confirming this understanding, and would ask that a copy of
our exchange of letters on this matter be included in the
Congressional Record during floor consideration of H.R. 4537.
Sincerely,
Kevin Brady,
Chairman.
____
House of Representative,
Committee on Financial Services,
Washington, DC, June 25, 2018.
Hon. Kevin Brady,
Chairman, Committee on Ways and Means,
Washington, DC.
Dear Chairman Brady: Thank you for your June 22, 2018
letter regarding H.R. 4537, the ``International Insurance
Standards Act of 2017''.
I am most appreciative of your decision to forego action on
H.R. 4537 so that it may move expeditiously to the House
floor, I acknowledge that although you are waiving action on
the bill, the Committee on Ways and Means is in no way
waiving its jurisdictional interest in this or similar
legislation. In addition, if a conference is necessary on
this legislation, I will support any request that your
committee be represented therein.
Finally, I shall be pleased to include your letter and this
letter in our committee's report on H.R. 4537 and in the
Congressional Record during floor consideration of the same.
Sincerely,
Jeb Hensarling,
Chairman.
____
Committee on Rules,
House of Representatives,
Washington, DC, June 25, 2018.
Hon. Jeb Hensarling,
Chairman, Committee on Financial Services, Washington, DC.
Dear Mr. Chairman: On December 13, 2017, the Committee on
Financial Services favorably ordered H.R. 4537, the
``International Insurance Standards Act of 2017,'' reported
to the House. As you know, the Committee on Rules was granted
an additional referral upon the bill's introduction pursuant
to the Committee's jurisdiction under rule X of the Rules of
the House of Representatives over the rules of the House and
special orders of business.
Because of your willingness to make the necessary changes
to provisions that fall within Rules Committee jurisdiction
prior to floor consideration of the bill. I will waive
consideration of the bill by the Rules Committee. By agreeing
to waive consideration of the bill, the Rules Committee does
not waive its jurisdiction over H.R. 4537. In addition, the
Committee reserves its authority to seek conferees on any
provisions of the bill that are within its jurisdiction
during any House-Senate conference that may be convened on
this legislation. I ask your commitment to support any
request by the Rules Committee for conferees on H.R. 4537 or
related legislation.
I also request that you include our exchange of letters on
this matter in the committee report to accompany H.R. 4537
and in the Congressional Record during consideration of this
legislation on the House floor. Thank you for your attention
to these matters.
Sincerely,
Pete Sessions,
Chairman.
____
House of Representatives,
Committee on Financial Services,
Washington, DC, June 26, 2018.
Hon. Pete Sessions,
Chairman, Committee on Rules,
Washington, DC.
Dear Chairman Sessions: Thank you for your June 25, 2018
letter regarding H.R. 4537, the ``International Insurance
Standards Act of 2017''.
I am most appreciative of your decision to forego action on
H.R. 4537 so that it may move expeditiously to the House
floor I acknowledge that although you are waiving action on
the bill, the Committee on Rules is in no way waiving its
jurisdictional interest in this or similar legislation. In
addition, if a conference is necessary on this legislation, I
will support any request that your committee be represented
therein.
Finally, I shall be pleased to include your letter and this
letter in our committee's report on H.R. 4537 and in the
Congressional Record during floor consideration of the same.
Sincerely,
Jeb Hensarling,
Chairman.
Ms. MAXINE WATERS of California. Mr. Speaker, I yield myself such
time as I may consume.
H.R. 4537, as amended, would ensure that international insurance
standards or agreements are consistent with our domestic insurance
system. The bill also encourages greater transparency, accountability,
and congressional involvement in the development of international
insurance standards and covered agreements.
{time} 1600
H.R. 4537, the International Insurance Standards Act of 2018, is a
product of months of bipartisan negotiations. I am pleased to be able
to support the final compromise bill that is before us today.
Today's bill is a reflection of the work of the bill's sponsors, Mr.
Duffy and Mr. Heck, and many others, including myself, to narrow and
streamline the bill so that we do not intentionally weaken the United
States' ability to negotiate strong rules internationally.
This is important. We cannot forget that, during 2007 and 2009, the
United States faced the most severe financial crisis since the Great
Depression. One of the most notable events during the crisis was the
near collapse of insurance giant AIG, which threatened the stability of
the entire U.S. financial system.
AIG's rapid demise and need for a Federal bailout underscored the
importance of consolidated supervision and appropriate prudential
standards for certain types of nonbank financial institutions,
including large, global insurance companies.
The Dodd-Frank Act helped us fill in these gaps. I would like to note
that the core Dodd-Frank reforms, in this respect, remain intact in
this bill.
Again, I would like to thank Mr. Duffy, Mr. Heck, and their staffs
for working with me and my staff to improve the bill.
Mr. Speaker, I reserve the balance of my time.
Mr. HUIZENGA. Mr. Speaker, I yield such time as he may consume to the
gentleman from Wisconsin (Mr. Duffy). My friend and colleague is a
leader of this effort.
Mr. DUFFY. Mr. Speaker, I want to thank the gentleman from Michigan,
who is also a very good friend of mine, for yielding.
I rise in support of H.R. 4537, the International Insurance Standards
Act. I first want to start with thanking the gentleman from Washington
(Mr. Heck) for the countless hours and effort that he put in, in a
bipartisan effort, crafting this bill that would allow us to get an
incredibly wonderful bipartisan vote.
On top of that, we had some jurisdictional issues, so we had two
chairmen from Texas, of the Ways and Means and Rules Committees,
Chairman Brady and Chairman Sessions, who also worked with us to
navigate those jurisdictional issues.
I also want to thank the ranking member, Ms. Waters, for working with
both Mr. Heck and me to navigate some of the issues that she had with
this bill to allow us to craft a piece of legislation that could get
bipartisan support. I know at a time when a lot of people don't think
that bipartisanship necessarily happens in this Chamber or in this
town, because it doesn't make great news, it happens. People work
together; they compromise; and they find a pathway forward. I think
this is a
[[Page H6010]]
great example of that, and I want to thank the ranking member for her
help in this effort and for her support. Again, it passed out of
committee 56-4.
In essence, what we are doing here is saying that we have had a
State-based model in America that has served this country very well for
150 years. We have been focusing on policyholder protection and
solvency protection. Our insurance industry has been pretty resilient,
and we are proud of it.
But we also recognize that the world is changing. It has become a far
smaller world. We have different standards in different countries, and
we have to be able to navigate those differences. As Americans, we have
to be able to engage with the rest of the world. That is a good thing.
But as we engage, we also want to make sure that we don't sell our
State-based American model for some other model in some other country.
If we want to change an insurance model of regulation in America,
that is our job in this Chamber. We shouldn't have some executive
appointee negotiate a trade deal that undermines our State-based model.
So that was the vision of what we are trying to accomplish.
In essence, we provide parameters to U.S. negotiators to prevent
Federal U.S. negotiators from entering into an international insurance
agreement unless it is consistent and reflective of the existing U.S.
system of insurance regulation. So, again, it has to be consistent and
reflective of our model.
It creates more transparency in the international insurance
negotiation process, as U.S. negotiators have to regularly inform
Congress as to the state and content of the negotiations that are being
undertaken. It also ensures that our State insurance regulators are
closely consulted in a process of the international insurance standards
setting.
So this is a well-crafted bill that took in concerns that both sides
of the aisle had.
I would like to note, as a Member of this body, and I think both
sides feel this way, and whether it was President Clinton or President
Bush or President Obama or now President Trump, we have a role in this
Chamber, and, oftentimes, we cede power to the executive. I think it is
important for us to exert some authority here to say that, if we are
going to change the rules, then you just can't do it without us and
through international negotiations.
I think this is a look to that point that, again, we have a great
model. If we are going to change it, we need to be a part of it. We
need to be consulted.
So with that, Mr. Speaker, I want to thank the ranking member, and I
want to thank Mr. Heck and the gentleman from Michigan.
Ms. MAXINE WATERS of California. Mr. Speaker, I yield myself the
balance of my time.
Mr. Speaker, I would like to take a special moment to thank Mr. Duffy
and Mr. Heck. They worked very hard to resolve the concerns and the
differences that arose in trying to put together this legislation.
As Mr. Duffy has said, the world has changed, and we cannot be
isolated in any way, just thinking about regulations that absolutely
are impacted by what is going on internationally. I think, with all the
hard work that was done by these two Members, we were able to figure
out how to protect the work of the States and the laws that we have,
but, at the same time, recognize that we are working in an
international atmosphere. We must understand that gaps must be closed;
I think we have done that sufficiently.
Again, I would like to thank them. Mr. Heck is just getting off the
plane. He wanted to be here, because he has worked so hard on this
legislation. He is not able to make it, but I want everybody to
recognize that he did a tremendous job in helping us work through the
difficulties of this legislation.
Mr. Speaker, I have no additional speakers, and I yield back the
balance of my time.
Mr. HUIZENGA. Mr. Speaker, I would like to point out to the ranking
member that that could, too, be a unifying part of the House of
Representatives, our collective frustration with the airlines and
delays in getting us all here in a timely fashion for important things
like this.
But that little bipartisan sentiment aside, I, too, want to commend
Mr. Heck and Mr. Duffy for their work on this, and I urge all of my
colleagues to support this underlying bill.
Mr. Speaker, I yield back the balance of my time.
The SPEAKER pro tempore (Mr. Francis Rooney of Florida). The question
is on the motion offered by the gentleman from Michigan (Mr. Huizenga)
that the House suspend the rules and pass the bill, H.R. 4537, as
amended.
The question was taken; and (two-thirds being in the affirmative) the
rules were suspended and the bill, as amended, was passed.
A motion to reconsider was laid on the table.
____________________