Number: RL34286
Title: Modernizing Insurance Regulation: Optional Federal Charter Legislation
Authors: Baird Webel, Government and Finance Division 
Abstract: Optional Federal Charter (OFC) legislation was first introduced in the 107th Congress, with bills being introduced in the 109th and 110th Congresses as well. Specifics of OFC legislation can vary widely, but the common thread is the creation of a dual regulatory system, inspired by the current banking regulatory system. OFC bills generally would create a federal insurance regulator that would operate concurrently with the present state system. Insurers would be able to choose whether to take out a federal charter, which would exempt them from most state insurance regulations, or to continue under a state charter and the 50 state system of insurance regulation. Given the greater uniformity of life insurance products and the greater competition faced by life insurers, some have suggested the possibility of OFC legislation that would apply only to life insurers, but no such bills have been introduced.
Pages: 13
Date: December 14, 2007