Sen. Cruz Leads Bill to Restore State Authority Over Insurance
WASHINGTON, D.C. – U.S. Sens. Ted Cruz (R-Texas), Mike Lee (R-Utah), Marsha Blackburn (R-Tenn.), and Rand Paul (R-Ky.) reintroduced the Federal Insurance Office Abolishment Act. The legislation abolishes the Federal Insurance Office (FIO) within the U.S. Department of the Treasury, returning sole regulatory authority over the insurance industry to the states.
Sen. Cruz said, “The Federal Insurance Office is a redundant, ever-expanding, unaccountable entity that infringes upon states’ authority to regulate the insurance industry. This legislation will rein in bureaucratic overreach by the federal government and empower state regulators to focus on what is best for consumers in their states.”
Sen. Lee said, “The Federal Insurance Office does not need to exist. It’s an Obama-era expansion of the federal bureaucracy created to intrude on states’ rights. Our bill will formally abolish this needless expense and return insurance regulation to the states, where it has always belonged.”
Sen. Blackburn said, “Insurance regulation has long been, and should remain, a responsibility of the states. The Federal Insurance Office Abolishment Act would eliminate unnecessary federal overreach, cut red tape, and return power to the states.”
Read the bill text here.
BACKGROUND
In 1945, Congress passed the McCarran-Ferguson Act, solidifying states’ regulatory authority over the insurance industry. Following the 2008 financial crisis, the Federal Insurance Office (FIO) was created by the Dodd-Frank Wall Street Reform and Consumer Protection Act, which granted the FIO specific financial stability, monitoring, and international responsibilities. However, these responsibilities duplicate functions within an industry that has long been regulated at the state level and traditionally overseen by state insurance regulators.
The Federal Insurance Office Abolishment Act would eliminate the FIO and restore primary regulatory authority over the insurance industry to the states.
Sen. Cruz previously introduced the Federal Insurance Office Abolishment Act in May 2019, March 2021, and May 2023.