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-
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, 
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. 
(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 and that any such final standard is com-
posed in plain writing (as such term is defined in 
section 3 of the Plain Writing Act of 2010 (5 U.S.C. 
301 note)). 
(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-
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.