Representative Scott Fitzgerald from Wisconsin has reintroduced a bill to remove the subpoena power of the Federal Insurance Office (FIO). This move comes as part of the Insurance Data Protection Act, which Fitzgerald first presented to the House of Representatives in September 2023.
Fitzgerald criticized the FIO, saying its recent efforts to gather insurance underwriting data under the pretext of climate risk are politically motivated. He believes that unelected officials should not be influencing insurance regulations in this way.
Earlier this year, the FIO released a report claiming to provide the most comprehensive data on homeowners insurance ever. However, industry groups quickly labeled the report as misleading and incomplete. The FIO has been trying to collect data on climate-related risks from property and casualty insurers since it proposed this initiative in October 2022. By March 2024, the FIO announced plans to work with the National Association of Insurance Commissioners (NAIC) for data collection. Yet, reports indicated that NAIC had ended its data-sharing agreement with the FIO, citing concerns about the quality of the FIO’s work.
The Insurance Data Protection Act has garnered support from several industry groups, including the National Association of Mutual Insurance Companies (NAMIC) and the American Property Casualty Insurance Association (APCIA). Jimi Grande from NAMIC emphasized that the FIO was not meant to act as an enforcement agency but rather to provide information to Congress and federal policymakers. He argued that the bill would ensure the FIO focuses on its original purpose.
Fitzgerald’s bill is seen as a starting point, with some lawmakers suggesting that Congress should consider eliminating the FIO entirely. Grande mentioned that, at the very least, Congress should think about reforms like stripping the FIO of its subpoena powers.
The APCIA also expressed support for the legislation, stating that it aims to reduce unnecessary data collection and enhance the protection of non-public information while still allowing access to information through state regulators. As discussions about the future of the FIO continue, the Insurance Data Protection Act represents a significant step in reshaping the federal role in insurance regulation.