U.S. Senators Ted Cruz, Mike Lee, Marsha Blackburn, and Rand Paul announced on Aug. 3 the reintroduction of the Federal Insurance Office Abolishment Act. The proposed legislation seeks to eliminate the Federal Insurance Office within the U.S. Department of the Treasury and return regulatory authority over the insurance industry solely to individual states.
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.”
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.” 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.”
Congress passed the McCarran-Ferguson Act in 1945, which established state regulatory authority over insurance. The Dodd-Frank Wall Street Reform and Consumer Protection Act created the Federal Insurance Office after the 2008 financial crisis with responsibilities including financial stability monitoring and international matters related to insurance; however, these functions have traditionally been handled at the state level.
The current bill would remove those federal functions by eliminating FIO entirely. Cruz previously introduced similar bills in May 2019, March 2021, and May 2023.
Cruz serves as a U.S. Senator representing Texas; he graduated cum laude from Princeton University and magna cum laude from Harvard Law School; he served as solicitor general of Texas; clerked for Chief Justice William Rehnquist on the U.S. Supreme Court; has two daughters with his wife Heidi; champions constitutional liberties; supports American energy dominance; leads border security efforts; and advocates for job growth policies, according to the official website.