FIO director: Who’s it going to be?
By Brian Anderson
Interested in perhaps the most influential job in the insurance industry? You have until Oct. 20 to apply.
That’s the deadline — finally! — being given to applicants for the brand-new position of director of the (also brand-new) Federal Insurance Office (FIO), which will be part of the Treasury Department. The Washington D.C.-based job will pay between $119,554 and $179,700 per year, according to the federal Website where the position opening is posted.
The successful candidate will immediately step into an incredibly challenging position as the responsible party for turning a couple of pages of the 2,300-page Dodd-Frank financial reform act into a new agency that could potentially evolve into a powerful federal regulatory body in a matter of months.
The director will advise Treasury Secretary Timothy Geithner (who will appoint the director — hopefully by early November) on insurance issues and potential regulatory gaps that might be serious enough to damage the financial system, will serve as a non-voting member of the Financial Stability Oversight Council (FSOC), and help the FSOC identify significant insurers that ought to be supervised by the Federal Reserve Board. The director will also serve as the U.S.’s public face in negotiating international insurance agreements.
This new director and the very existence of the FIO is certainly cause for alarm for state insurance commissioners, who have served as the primary regulators of the insurance industry for more than a century. While the Dodd-Frank Act keeps the current state-run insurance regulatory system intact, many observers acknowledge the possibility that the FIO could lead to federal regulation of the industry.
The act directs the FIO to report to Congress by January 2012 on how to modernize the U.S. system of insurance regulation, making recommendations for the legislative, administrative and regulatory changes that are necessary to carry out the findings in the report. Those recommendations could well include the federal government taking on a much more prominent role in insurance regulation.
So who will be given this historic opportunity as the first-ever director of the Federal Insurance Office? I would imagine plenty of current and former state insurance commissioners have thrown their hats in the ring, and I would suspect the choice would come from that type of background.
Whoever it may be, just let it the decision come quickly, please, Mr. Geithner. This person needs to get a whole new office up and running, and the last thing we want is the director rushing to complete that all-important report to Congress.