Policyholder Protection Act of 2015

Bill: 114-hr-1478
Sponsor: full_name: Rep. Posey, Bill [R-FL-8]
Introduced: 2015-03-19
Policy area: Finance and Financial Sector
Subjects: 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
Latest action: action_date: 2015-11-17
text: Received in the Senate and Read twice and referred to the Committee on Banking, Housing, and Urban Affairs.

Summaries:
action_date: 2015-03-19
action_desc: Introduced in House
text: <p><b>Policyholder Protection Act of 2015</b></p> <p>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:</p> <ul> <li>such funds or assets are to be provided by the entity, and</li> <li>the relevant state insurance authority determines that such an action would have a materially adverse effect on the entity's financial condition.</li> </ul> <p>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. </p> <p>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.</p> <p>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.</p> <p>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.

action_date: 2015-11-16
action_desc: Passed House amended
text: <p><b>Policyholder Protection Act of 2015</b></p> <p> (Sec. 2) 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:</p> <ul> <li>such funds or assets are to be provided by the entity, and</li> <li>the relevant state insurance authority determines that such an action would have a materially adverse effect on the entity's financial condition.</li> </ul> <p>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. </p> <p>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.</p> <p>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.</p> <p>The FDIC may take such a lien only: <ul> <li>to secure repayment of funds made available to such covered financial company or covered subsidiary; and</li> <li>if it determines that the lien will neither unduly impede nor delay the liquidation or rehabilitation of the insurance company, or the recovery by its policyholders. </li> </ul>

tv_txt: I 114th CONGRESS 1st Session H. R. 1478 IN THE HOUSE OF REPRESENTATIVES March 19, 2015 Mr. Posey (for himself and Mr. Sherman ) introduced the following bill; which was referred to the Committee on Financial Services A BILL To 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.

1. Short title This Act may be cited as the Policyholder Protection Act of 2015 . 2. Source of strength Section 38A of the Federal Deposit Insurance Act ( 12 U.S.C. 1831o–1 ) is amended— (1) by redesignating subsections (c), (d), and (e) as subsections (d), (e), and (f), respectively; and (2) by inserting after subsection (b) the following: (c) Authority of State Insurance Regulator (1) In general The provisions of section 5(g) of the Bank Holding Company Act of 1956 ( 12 U.S.C. 1844(g) ) shall apply to a savings and loan holding company that is an insurance company, an affiliate of an insured depository institution that is an insurance company, and to any other company that is an insurance company and that directly or indirectly controls an insured depository institution, to the same extent as such section 5(g) applies to a bank holding company that is an insurance company. (2) Rule of construction Requiring a bank holding company that is an insurance company, a savings and loan holding company that is 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 that directly or indirectly controls an insured depository institution to serve as a source of financial strength under this section shall be deemed an action of the Board that requires a bank holding company to provide funds or other assets to a subsidiary depository institution for purposes of such section 5(g). . 3. Liquidation authority The Dodd-Frank Wall Street Reform and Consumer Protection Act ( 12 U.S.C. 5301 et seq. ) is amended— (1) in section 203(e)(3), by inserting or rehabilitation after orderly liquidation each place such term appears; and (2) in section 204(d)(4), by inserting before the semicolon the following: , except that, if the covered financial company or covered subsidiary is an insurance company or a subsidiary of an insurance company, the Corporation— (A) shall promptly notify the State insurance authority for the insurance company of the intention to take such lien; and (B) may not take such lien if the State insurance authority notified under subparagraph (A) informs the Corporation, in writing, within 15 days of such notice, that the taking of the lien on the assets of such company would have a materially adverse effect on the policyholders of such company .

tv_txt: IIB 114th CONGRESS 1st Session H. R. 1478 IN THE SENATE OF THE UNITED STATES November 17, 2015 Received; read twice and referred to the Committee on Banking, Housing, and Urban Affairs AN ACT To 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.

1. Short title This Act may be cited as the Policyholder Protection Act of 2015 . 2. Ensuring the protection of insurance policyholders (a) Source of strength Section 38A of the Federal Deposit Insurance Act ( 12 U.S.C. 1831o–1 ) is amended— (1) by redesignating subsections (c), (d), and (e) as subsections (d), (e), and (f), respectively; and (2) by inserting after subsection (b) the following: (c) Authority of State insurance regulator (1) In general The provisions of section 5(g) of the Bank Holding Company Act of 1956 ( 12 U.S.C. 1844(g) ) shall apply to a savings and loan holding company that is an insurance company, an affiliate of an insured depository institution that is an insurance company, and to any other company that is an insurance company and that directly or indirectly controls an insured depository institution, to the same extent as the provisions of that section apply to a bank holding company that is an insurance company. (2) Rule of construction Requiring a bank holding company that is an insurance company, a savings and loan holding company that is 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 that directly or indirectly controls an insured depository institution to serve as a source of financial strength under this section shall be deemed an action of the Board that requires a bank holding company to provide funds or other assets to a subsidiary depository institution for purposes of section 5(g) of the Bank Holding Company Act of 1956 ( 12 U.S.C. 1844(g) ). . (b) Liquidation authority The Dodd-Frank Wall Street Reform and Consumer Protection Act ( 12 U.S.C. 5301 et seq. ) is amended— (1) in section 203(e)(3) ( 12 U.S.C. 5383(e)(3) ), by inserting or rehabilitation after orderly liquidation each place that term appears; and (2) in section 204(d)(4) ( 12 U.S.C. 5384(d)(4) ), by inserting before the semicolon at the end the following: “, except that, if the covered financial company or covered subsidiary is an insurance company or a subsidiary of an insurance company, the Corporation— (A) shall promptly notify the State insurance authority for the insurance company of the intention to take such lien; and (B) may only take such lien— (i) to secure repayment of funds made available to such covered financial company or covered subsidiary; and (ii) if the Corporation determines, after consultation with the State insurance authority, that such lien will not unduly impede or delay the liquidation or rehabilitation of the insurance company, or the recovery by its policyholders .

Passed the House of Representatives November 16, 2015. Karen L. Haas, Clerk

tv_txt: IB Union Calendar No. 260 114th CONGRESS 1st Session H. R. 1478 [Report No. 114–338] IN THE HOUSE OF REPRESENTATIVES March 19, 2015 Mr. Posey (for himself and Mr. Sherman ) introduced the following bill; which was referred to the Committee on Financial Services November 16, 2015 Additional sponsors: Ms. Bordallo , Mr. Duncan of Tennessee , Mr. Ross , Mr. Stivers , Mr. Byrne , Mr. Fincher , Mr. Heck of Nevada , Mr. Jones , Mr. Wilson of South Carolina , Mr. Huizenga of Michigan , Mrs. Wagner , Mr. Mulvaney , Mr. Pearce , Mr. Grothman , Mr. Blum , Mr. Tipton , Mr. Duffy , Mr. Guthrie , Mrs. Noem , Mr. Hultgren , Mr. Amodei , Mr. Gosar , Mr. Webster of Florida , Mr. Joyce , Mrs. Roby , Mr. Poliquin , Mr. Cramer , Mr. Barr , Mr. Harris , Mr. Pittenger , Mr. Emmer of Minnesota , Mr. Heck of Washington , Mr. Lucas , and Mr. Delaney November 16, 2015 Reported with an amendment, committed to the Committee of the Whole House on the State of the Union, and ordered to be printed Strike out all after the enacting clause and insert the part printed in italic For text of introduced bill, see copy of bill as introduced on March 19, 2015 A BILL To 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.

1. Short title This Act may be cited as the Policyholder Protection Act of 2015 . 2. Ensuring the protection of insurance policyholders (a) Source of strength Section 38A of the Federal Deposit Insurance Act ( 12 U.S.C. 1831o–1 ) is amended— (1) by redesignating subsections (c), (d), and (e) as subsections (d), (e), and (f), respectively; and (2) by inserting after subsection (b) the following: (c) Authority of State insurance regulator (1) In general The provisions of section 5(g) of the Bank Holding Company Act of 1956 ( 12 U.S.C. 1844(g) ) shall apply to a savings and loan holding company that is an insurance company, an affiliate of an insured depository institution that is an insurance company, and to any other company that is an insurance company and that directly or indirectly controls an insured depository institution, to the same extent as the provisions of that section apply to a bank holding company that is an insurance company. (2) Rule of construction Requiring a bank holding company that is an insurance company, a savings and loan holding company that is 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 that directly or indirectly controls an insured depository institution to serve as a source of financial strength under this section shall be deemed an action of the Board that requires a bank holding company to provide funds or other assets to a subsidiary depository institution for purposes of section 5(g) of the Bank Holding Company Act of 1956 ( 12 U.S.C. 1844(g) ). . (b) Liquidation authority The Dodd-Frank Wall Street Reform and Consumer Protection Act ( 12 U.S.C. 5301 et seq. ) is amended— (1) in section 203(e)(3) ( 12 U.S.C. 5383(e)(3) ), by inserting or rehabilitation after orderly liquidation each place that term appears; and (2) in section 204(d)(4) ( 12 U.S.C. 5384(d)(4) ), by inserting before the semicolon at the end the following: “, except that, if the covered financial company or covered subsidiary is an insurance company or a subsidiary of an insurance company, the Corporation— (A) shall promptly notify the State insurance authority for the insurance company of the intention to take such lien; and (B) may only take such lien— (i) to secure repayment of funds made available to such covered financial company or covered subsidiary; and (ii) if the Corporation determines, after consultation with the State insurance authority, that such lien will not unduly impede or delay the liquidation or rehabilitation of the insurance company, or the recovery by its policyholders .

November 16, 2015 Reported with an amendment, committed to the Committee of the Whole House on the State of the Union, and ordered to be printed

tv_txt: I 114th CONGRESS 1st Session H. R. 1478 IN THE HOUSE OF REPRESENTATIVES AN ACT To 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.

1. Short title This Act may be cited as the Policyholder Protection Act of 2015 . 2. Ensuring the protection of insurance policyholders (a) Source of strength Section 38A of the Federal Deposit Insurance Act ( 12 U.S.C. 1831o–1 ) is amended— (1) by redesignating subsections (c), (d), and (e) as subsections (d), (e), and (f), respectively; and (2) by inserting after subsection (b) the following: (c) Authority of State insurance regulator (1) In general The provisions of section 5(g) of the Bank Holding Company Act of 1956 ( 12 U.S.C. 1844(g) ) shall apply to a savings and loan holding company that is an insurance company, an affiliate of an insured depository institution that is an insurance company, and to any other company that is an insurance company and that directly or indirectly controls an insured depository institution, to the same extent as the provisions of that section apply to a bank holding company that is an insurance company. (2) Rule of construction Requiring a bank holding company that is an insurance company, a savings and loan holding company that is 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 that directly or indirectly controls an insured depository institution to serve as a source of financial strength under this section shall be deemed an action of the Board that requires a bank holding company to provide funds or other assets to a subsidiary depository institution for purposes of section 5(g) of the Bank Holding Company Act of 1956 ( 12 U.S.C. 1844(g) ). . (b) Liquidation authority The Dodd-Frank Wall Street Reform and Consumer Protection Act ( 12 U.S.C. 5301 et seq. ) is amended— (1) in section 203(e)(3) ( 12 U.S.C. 5383(e)(3) ), by inserting or rehabilitation after orderly liquidation each place that term appears; and (2) in section 204(d)(4) ( 12 U.S.C. 5384(d)(4) ), by inserting before the semicolon at the end the following: “, except that, if the covered financial company or covered subsidiary is an insurance company or a subsidiary of an insurance company, the Corporation— (A) shall promptly notify the State insurance authority for the insurance company of the intention to take such lien; and (B) may only take such lien— (i) to secure repayment of funds made available to such covered financial company or covered subsidiary; and (ii) if the Corporation determines, after consultation with the State insurance authority, that such lien will not unduly impede or delay the liquidation or rehabilitation of the insurance company, or the recovery by its policyholders .

Passed the House of Representatives November 16, 2015. Karen L. Haas, Clerk.