I 
114TH CONGRESS 
2D SESSION 
H. R. 5143 
To provide greater transparency and congressional oversight of international 
insurance standards setting processes, and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
APRIL 29, 2016 
Mr. LUETKEMEYER (for himself, Mr. HUIZENGA of Michigan, Mr. PEARCE, 
Mrs. WAGNER, Mr. BARR, Mr. ROTHFUS, and Mr. WESTMORELAND) in-
troduced the following bill; which was referred to the Committee on Fi-
nancial Services 
A BILL 
To provide greater transparency and congressional oversight 
of international insurance standards setting processes, 
and for other purposes. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Transparent Insurance 
Standards Act of 2016’’. 
SEC. 2. CONGRESSIONAL FINDINGS. 
The Congress finds the following: 
(1) The State-based system for insurance regu-
lation in the United States has served American con-
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sumers well for more than 150 years and has fos-
tered an open and competitive marketplace with a 
diversity of insurance products to the benefit of pol-
icyholders and consumers. 
(2) Protecting policyholders by regulating to en-
sure 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 pru-
dential regulation and emerging international stand-
ards. 
(3) United States officials participating in dis-
cussions or negotiations regarding international in-
surance standards shall support standards designed 
for the protection of policyholders. 
(4) The Secretary of the Treasury shall seek 
advice and recommendations from a diverse group of 
outside experts in performing the duties and au-
thorities of the Secretary to coordinate Federal ef-
forts and develop Federal policy on prudential as-
pects of international insurance matters. 
(5) The draft of the Higher Loss Absorbency 
capital standard adopted in 2015 by the Inter-
national Association of Insurance Supervisors, not-
withstanding the concerns of U.S. parties to the 
International Association of Insurance Supervisors, 
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unequally affects insurance products offered in the 
United States, an issue that must be addressed. 
(6) Any international standard agreed to at the 
International Association of Insurance Supervisors is 
not self-executing in the United States for any in-
surer until implemented through the required Fed-
eral or State legislative or regulatory process. 
SEC. 3. OBJECTIVES FOR INTERNATIONAL INSURANCE 
STANDARDS. 
The objectives of the United States regarding inter-
national insurance standards are as follows: 
(1) To ensure standards that maintain strong 
protection of policy holders, as reflected in the 
United States solvency regime. 
(2) To ensure, pursuant to enactment of the In-
surance Capital Standards Clarification Act of 2014 
(Public Law 113–279), standards that are appro-
priate for insurers and are not bank-centric in na-
ture. 
(3) To promote a principles-based approach to 
insurance supervision, in which capital adequacy is 
assessed using risk-based capital requirements for 
insurance combined with qualitative risk assessment 
and management tools. 
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(4) To consider the most efficient and least dis-
ruptive approaches to enhancing regulatory assess-
ment of the capital adequacy of insurance groups, 
including tools that are already in place. 
(5) To ensure that any international insurance 
standard recognizes prudential measures used within 
the United States as satisfying standards finalized 
by international standard-setting organizations. 
(6) To support increasing transparency at any 
global insurance or international standard-setting or-
ganization in which the United States participates, 
including advocating for greater stakeholder public 
observer access to working groups and committee 
meetings of the International Association of Insur-
ance Supervisors. 
(7) To ensure that there is a sufficient period 
for public consultation and comment regarding any 
proposed international insurance standard before it 
takes effect. 
(8) To ensure that the Secretary of the Treas-
ury and the Board of Governors of the Federal Re-
serve System achieve consensus positions with State 
insurance commissioners when the Secretary and the 
Board are United States participants in discussions 
on insurance issues before the International Associa-
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tion of Insurance Supervisors, Financial Stability 
Board, or any other international forum of financial 
regulators or supervisors that considers such issues. 
(9) To consider the impact of any such stand-
ard on the availability and cost of products to con-
sumers. 
(10) To avoid measures that could limit the 
availability and accessibility of risk protection and 
retirement security products that are essential to 
meeting the needs of aging populations. 
(11) To ensure that the merits of existing 
State-based capital standards are recognized and in-
corporated in any domestic or global insurance cap-
ital standard. 
(12) To advocate for insurance regulatory 
standards that are based on the nature, scale, and 
complexity of the risks posed by the regulated insur-
ance group and entity or activity. 
SEC. 4. REQUIREMENTS FOR CONSENT TO ADOPT INTER-
NATIONAL INSURANCE STANDARDS. 
(a) PUBLICATION
OF STANDARDS; ADOPTION
OF 
CAPITAL
AND PRUDENTIAL STANDARDS.—The United 
States may not agree to, accept, establish, enter into, or 
consent to the adoption of a final international insurance 
standard with an international standard-setting organiza-
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tion or a foreign government, authority, or regulatory enti-
ty unless the requirements under both of the following 
paragraphs are complied with: 
(1) PUBLICATION.—The requirements under 
this paragraph are complied with if the conditions 
under one of the following subparagraphs have been 
met: 
(A) BY
FEDERAL
RESERVE
AND
TREAS-
URY.—The Chairman of the Board of Gov-
ernors of the Federal Reserve System and the 
Secretary of the Treasury have caused the pro-
posed text of the proposed international insur-
ance standard to be published in the Federal 
Register and made available for public comment 
for a period of not fewer than 30 days (which 
period may run concurrently with the 90-day 
period referred to in subsection (b)(3)). 
(B) 
BY
STATE
INSURANCE
COMMIS-
SIONERS.—The State insurance commissioners 
have caused the proposed text of the proposed 
international insurance standard to be pub-
lished in a similar form and manner that pro-
vides for notice and public comment. 
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(2) CAPITAL STANDARD.—In the case only of a 
final international insurance standard setting forth 
any capital standard or standards for insurers— 
(A) such international capital standard is 
consistent with capital requirements set forth in 
the State-based system of insurance regulation; 
(B) the Board has issued capital require-
ments for insurance companies supervised by 
the Board and subject to such requirements, 
which shall be issued through rulemaking in ac-
cordance with the procedures established under 
section 553 of title 5, United States Code, re-
garding substantive rules, under which the peri-
ods for notice and public comment shall each 
have a duration of not fewer than 60 days; and 
(C) to the extent that such international 
capital standard is intended to be applied to a 
company or companies supervised by the Board 
of Governors of the Federal Reserve System, is 
consistent with the capital requirements of the 
Board for such companies. 
(b) SUBMISSION AND LAYOVER PROVISIONS.—The 
Secretary and the Board may not agree to, accept, estab-
lish, enter into, or consent to the adoption of an inter-
national insurance standard established through an inter-
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national standard-setting organization or a foreign govern-
ment, authority, or regulatory entity unless— 
(1) the Secretary and the Board have— 
(A) conducted an analysis under subsection 
(c) of the proposed international insurance 
standard; and 
(B) submitted to the covered congressional 
committees, on a day on which both Houses of 
Congress are in session, a copy of the proposed 
final text of the proposed international insur-
ance standard and the report required under 
subsection (c)(2) regarding such analysis; 
(2) the Secretary and the Chairman of the 
Board have determined, pursuant to such analysis, 
that the proposed standard will not result in any 
change in State law; and 
(3) a period of 90 calendar days beginning on 
the date on which the copy of the proposed final text 
of the standard is submitted to the covered congres-
sional committees under paragraph (1)(B) has ex-
pired, during which period the Congress may take 
action to approve or reject such final standard. 
(c) JOINT ANALYSIS BY CHAIR OF THE FEDERAL 
RESERVE AND SECRETARY OF THE TREASURY.— 
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(1) IN GENERAL.—An analysis under this sub-
section of a proposed final international insurance 
standard shall be an analysis conducted by the Sec-
retary and the Chairman of the Board of Governors 
of the Federal Reserve System, in consultation with 
the State insurance commissioners, of the impact of 
such standard on consumers and markets in the 
United States and whether any changes in State law 
will result from such final standard. 
(2) REPORT.—Upon completion of an analysis 
under this subsection of a final international insur-
ance standard, the Secretary and the Board shall 
submit a report on the results of the analysis to the 
covered congressional committees and the Comp-
troller General of the United States. The report 
shall include a statement setting forth the deter-
mination made pursuant to paragraph (1) regarding 
any changes in State law resulting from such final 
standard. 
(3) NOTICE AND COMMENT.— 
(A) NOTICE.—The Secretary and the 
Chairman of the Board of Governors of the 
Federal Reserve System shall provide notice be-
fore the date on which drafting the report is 
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commenced and after the date on which the 
draft of the report is completed. 
(B) OPPORTUNITY FOR COMMENT.—There 
shall be an opportunity for public comment for 
a period beginning on the date on which the re-
port is submitted under paragraph (2) and end-
ing on the date that is not fewer than 60 days 
after the date on which the report is submitted. 
Nothing in this subparagraph shall affect the 
authority of the Board to issue the rule referred 
to in subsection (a)(2). 
(4) REVIEW
BY
COMPTROLLER
GENERAL.— 
Upon submission of a report pursuant to paragraph 
(2) to the Comptroller General, the Comptroller 
General shall review the report and shall submit a 
report to the Congress setting forth the conclusions 
of the Comptroller General’s review. 
(d) LIMITED EFFECT.—This section may not be con-
strued to establish or expand any authority to implement 
an international insurance standard in the United States 
or for the United States or any representative of the Fed-
eral Government to adopt or enter into any international 
insurance standard. 
(e) TREATMENT
OF STATE LAW.—In accordance 
with the Act of March 9, 1945 (Chapter 20; 59 Stat. 33; 
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15 U.S.C. 1011 et seq.), commonly referred to as the 
‘‘McCarran-Ferguson Act’’, this section may not be con-
strued to preempt State law. 
SEC. 5. REPORTS. 
(a) REPORTS AND TESTIMONY BY SECRETARY OF 
THE TREASURY
AND CHAIR
OF
THE FEDERAL RE-
SERVE.—The Secretary and the Chairman of the Board 
of Governors of the Federal Reserve System shall submit 
to the covered congressional committees an annual report 
and provide testimony, not less often than every 6 months, 
to the covered congressional committees on the efforts of 
the Secretary and the Chairman with the State insurance 
commissioners with respect to international insurance 
standard-setting organizations and international insur-
ance standards, including— 
(1) a description of the insurance standard-set-
ting issues under discussion at international stand-
ard-setting bodies, including the Financial Stability 
Board and the International Association of Insur-
ance Supervisors; 
(2) a description of the effects that inter-
national insurance standards could have on con-
sumers and insurance markets in the United States; 
(3) a description of any position taken by the 
Secretary and the Board in international insurance 
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discussions or on any international insurance stand-
ard; 
(4) a description of the efforts by the Secretary 
and the Board to increase transparency and ac-
countability at the Financial Stability Board with re-
spect to insurance proposals and the International 
Association of Insurance Supervisors, including ef-
forts to provide additional public access to working 
groups and committees of the International Associa-
tion of Insurance Supervisors; and 
(5) a description of how the Secretary and the 
Board are meeting the objectives set forth in section 
3, or, if such objectives are not being met, an expla-
nation of the reasons for not meeting such objec-
tives. 
(b) REPORTS AND TESTIMONY BY STATE INSURANCE 
COMMISSIONERS.—The State insurance commissioners 
may provide testimony or reports to the Congress on the 
issues described in subsection (a). 
(c) REPORT
ON TRANSPARENCY.—Not later than 
180 days after the date of enactment of this Act, the 
Chairman of the Board of Governors of the Federal Re-
serve System and the Secretary shall submit to the Con-
gress a report and provide testimony to the Congress on 
the efforts of the Chairman and the Secretary pursuant 
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to subsection (a)(4) of this section to increase trans-
parency at meetings of the International Association of In-
surance Supervisors. 
SEC. 6. DEFINITIONS. 
In this Act: 
(1) BOARD.—The term ‘‘Board’’ means the 
Board of Governors of the Federal Reserve System, 
or the designee of the Board. 
(2) COVERED CONGRESSIONAL COMMITTEES.— 
The term ‘‘covered congressional committees’’ means 
the Committee on Financial Services of the House of 
Representatives and the Committee on Banking, 
Housing and Urban Affairs of the Senate. 
(3) INTERNATIONAL INSURANCE STANDARD.— 
The term ‘‘international insurance standard’’ means 
any international insurance supervisory standard de-
veloped by an international standards setting organi-
zation, or regulatory or supervisory forum, in which 
the United States participates, including the Com-
mon Framework for the Supervision of Internation-
ally Active Insurance Groups, the Financial Stability 
Board, and the International Association of Insur-
ance Supervisors. 
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(4) SECRETARY.—The term ‘‘Secretary’’ means 
the Secretary of the Treasury, or the Secretary’s 
designee. 
(5) STATE INSURANCE COMMISSIONERS.—The 
term ‘‘State insurance commissioners’’ means the 
heads of the insurance commissions for the States, 
or State employees who are the designees of such of-
ficials. 
SEC. 7. TREATMENT OF COVERED AGREEMENTS. 
Section 314 of title 31, United States Code is amend-
ed— 
(1) in subsection (c)— 
(A) by designating paragraphs (1) and (2) 
as paragraphs (2) and (3), respectively; and 
(B) by inserting before paragraph (2), as 
so redesignated, the following new paragraph: 
‘‘(1) the Secretary of the Treasury and the 
United States Trade Representative have caused to 
be published in the Federal Register, and made 
available for public comment for a period of not 
fewer than 30 days (which period may run concur-
rently with the 90-day period for the covered agree-
ment referred to in paragraph (3)), the proposed 
text of the covered agreement;’’; and 
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(2) by adding at the end the following new sub-
sections: 
‘‘(d) CONSULTATION WITH STATE INSURANCE COM-
MISSIONERS.—In any negotiations regarding a con-
templated covered agreement, the Secretary and the 
United States Trade Representative shall consult with and 
directly include State insurance commissioners. 
‘‘(e) PROHIBITION ON REGULATORY AUTHORITY.— 
In accordance with subsections (k) and (l) of section 313, 
a covered agreement shall not be used to establish or pro-
vide the Federal Insurance Office or the Treasury with 
any general supervisory or regulatory authority over the 
business of insurance or with the authority to participate 
in a supervisory college or similar process. 
‘‘(f) TREATMENT UNDER OTHER LAW.—A covered 
agreement shall not be considered an international insur-
ance standard for purposes of the Transparent Insurance 
Standards Act of 2016 and shall not be subject to such 
Act.’’. 
SEC. 8. DUTIES OF INDEPENDENT MEMBER OF FINANCIAL 
STABILITY OVERSIGHT COUNCIL. 
Subsection (a) of section 112 of the Dodd-Frank Wall 
Street Reform and Consumer Protection Act (12 U.S.C. 
5322(a)) is amended by adding at the end the following 
new paragraph: 
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‘‘(3) DUTIES OF INDEPENDENT MEMBER.—To 
assist the Council with its responsibilities to monitor 
international insurance developments, advise Con-
gress, and make recommendations, the Independent 
Member of the Council shall have the authority to— 
‘‘(A) regularly consult with international 
insurance supervisors and international finan-
cial stability counterparts; 
‘‘(B) consult with, advise, and assist the 
Secretary of the Treasury with respect to rep-
resenting the Federal Government of the 
United States, as appropriate, in the Inter-
national Association of Insurance Supervisors 
(including to become a non-voting member 
thereof), particularly on matters of systemic 
risk, and to consult with the Board of Gov-
ernors of the Federal Reserve System and the 
States concerning such matters; 
‘‘(C) attend the Financial Stability Board 
of The Group of Twenty and join with other 
members from the United States, including on 
matters related to insurance and financial sta-
bility, and provide for the attendance and par-
ticipation at such Board, on matters related to 
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