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Federal Insurance Office Is Voted Into Existence By Congress


Federal Insurance Office (FIO) Voted Into Existence

A Federal Insurance Office was voted into existence by Congress.  The House recently passed the Wall Street Reform and Consumer Protection Act of 2009. The legislation is a great move overall to protect consumerism in the US. The part of the bill that concerns me is the creation of a Federal Insurance Office (FIO). Many years ago, Congress had decided to let the states monitor their own insurance activities. This had operated very well for decades.

Painting Graphic of Federal Insurance Office Voted Into Existence People

The AIG bailout had very little to do with the insurance products that AIG provided for consumers and businesses. The financial sector of AIG is the area that failed horribly. Congress decided to protect all consumers from a financial insurance meltdown. They did not separate the financial sector of AIG from its insurance products when crafting this part of the bill.

There were two things that jumped off the screen when I read them. The FIO is going to be an informational source for the federal government. Why would this be needed unless more regulations are coming down the road? The other and more frightening part of the FIO is the title of systemic risk regulator. There is some mention that the property and casualty arena would be excluded – for now.

Graphic Voted Into Existence Federal Insurance

Insurance is built on a certain systemic risk or there would be no need for insurance products. Would the FIO regulate Class Codes for Workers Compensation? Could the FIO create its own federal insurer of last resort that would compete with carriers? Will agents have another pile of forms to complete every time an insurance transaction is initiated? I am sure you have your own questions about this change in the insurance system.

I just returned from an NCCI State Advisory meeting in South Carolina. I will cover the meeting more closely and cover NCCI’s prediction of the FIO in my next post. It was right on target.

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James J Moore - Workers Comp Expert

Raleigh, NC, United States

About The Author...

James founded a Workers’ Compensation consulting firm, J&L Risk Management Consultants, Inc. in 1996. J&L’s mission is to reduce our clients’ Workers Compensation premiums by using time-tested techniques. J&L’s claims, premium, reserve and Experience Mod reviews have saved employers over $9.8 million in earned premiums over the last three years. J&L has saved numerous companies from bankruptcy proceedings as a result of insurance overpayments.

James has over 27 years of experience in insurance claims, audit, and underwriting, specializing in Workers’ Compensation. He has supervised, and managed the administration of Workers’ Compensation claims, and underwriting in over 45 states. His professional experience includes being the Director of Risk Management for the North Carolina School Boards Association. He created a very successful Workers’ Compensation Injury Rehabilitation Unit for school personnel.

James’s educational background, which centered on computer technology, culminated in earning a Masters of Business Administration (MBA); an Associate in Claims designation (AIC); and an Associate in Risk Management designation (ARM). He is a Chartered Financial Consultant (ChFC) and a licensed financial advisor. The NC Department of Insurance has certified him as an insurance instructor. He also possesses a Bachelors’ Degree in Actuarial Science.

LexisNexis has twice recognized his blog as one of the Top 25 Blogs on Workers’ Compensation. J&L has been listed in AM Best’s Preferred Providers Directory for Insurance Experts – Workers Compensation for over eight years. He recently won the prestigious Baucom Shine Lifetime Achievement Award for his volunteer contributions to the area of risk management and safety. James was recently named as an instructor for the prestigious Insurance Academy.

James is on the Board of Directors and Treasurer of the North Carolina Mid-State Safety Council. He has published two manuals on Workers’ Compensation and three different claims processing manuals. He has also written and has been quoted in numerous articles on reducing Workers’ Compensation costs for public and private employers. James publishes a weekly newsletter with 7,000 readers.

He currently possess press credentials and am invited to various national Workers Compensation conferences as a reporter.

James’s articles or interviews on Workers’ Compensation have appeared in the following publications or websites:

  • Risk and Insurance Management Society (RIMS)
  • Entrepreneur Magazine
  • Bloomberg Business News
  • WorkCompCentral.com
  • Claims Magazine
  • Risk & Insurance Magazine
  • Insurance Journal
  • Workers Compensation.com
  • LinkedIn, Twitter, Facebook and other social media sites
  • Various trade publications


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