|Posted:||March 29, 2022 11:38 AM|
|From:||Senator John DiSanto and Sen. Sharif Street|
|To:||All Senate members|
|Subject:||Preserving State-based Insurance Oversight|
|Soon we will introduce amendments to Pennsylvania’s laws governing insurance holding companies to comply with two Covered Agreements between the United States and the European Union and United Kingdom. Pennsylvania has until November 2022 to adopt the amendments or its domestic insurance groups with European operations will be subject to EU and UK financial and accounting standards and regulations.
Our legislation adopts the National Association of Insurance Commissioners’ (NAIC) model for conducting a Group Capital Calculation (GCC) and Liquidity Stress Test (LST). These two financial analytical tools offer a more comprehensive understanding of the financial conditions, capital allocation, and risks of insurance groups, and they provide the basis for macroprudential performance and surveillance, which is critical in mitigating costs and risks during economic downturns.
Both the GCC and LST will become NAIC Accreditation Program standards that Pennsylvania’s Insurance Department must implement to maintain its accreditation.
Please join us in cosponsoring enhanced state-based solvency laws intended to better protect consumers and avoid costly and disruptive international regulation of domestic insurers.
Introduced as SB1222