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H.R. 1478 (114th): Policyholder Protection Act of 2015


The text of the bill below is as of Nov 17, 2015 (Referred to Senate Committee).


IIB

114th CONGRESS

1st Session

H. R. 1478

IN THE SENATE OF THE UNITED STATES

November 17, 2015

Received; read twice and referred to the Committee on Banking, Housing, and Urban Affairs

AN ACT

To provide for notice to, and input by, State insurance commissioners when requiring an insurance company to serve as a source of financial strength or when the Federal Deposit Insurance Corporation places a lien against an insurance company’s assets, and for other purposes.


1.

Short title

This Act may be cited as the Policyholder Protection Act of 2015.

2.

Ensuring the protection of insurance policyholders

(a)

Source of strength

Section 38A of the Federal Deposit Insurance Act (12 U.S.C. 1831o–1) is amended—

(1)

by redesignating subsections (c), (d), and (e) as subsections (d), (e), and (f), respectively; and

(2)

by inserting after subsection (b) the following:

(c)

Authority of State insurance regulator

(1)

In general

The provisions of section 5(g) of the Bank Holding Company Act of 1956 (12 U.S.C. 1844(g)) shall apply to a savings and loan holding company that is an insurance company, an affiliate of an insured depository institution that is an insurance company, and to any other company that is an insurance company and that directly or indirectly controls an insured depository institution, to the same extent as the provisions of that section apply to a bank holding company that is an insurance company.

(2)

Rule of construction

Requiring a bank holding company that is an insurance company, a savings and loan holding company that is an insurance company, an affiliate of an insured depository institution that is an insurance company, or any other company that is an insurance company and that directly or indirectly controls an insured depository institution to serve as a source of financial strength under this section shall be deemed an action of the Board that requires a bank holding company to provide funds or other assets to a subsidiary depository institution for purposes of section 5(g) of the Bank Holding Company Act of 1956 (12 U.S.C. 1844(g)).

.

(b)

Liquidation authority

The Dodd-Frank Wall Street Reform and Consumer Protection Act (12 U.S.C. 5301 et seq.) is amended—

(1)

in section 203(e)(3) (12 U.S.C. 5383(e)(3)), by inserting or rehabilitation after orderly liquidation each place that term appears; and

(2)

in section 204(d)(4) (12 U.S.C. 5384(d)(4)), by inserting before the semicolon at the end the following: “, except that, if the covered financial company or covered subsidiary is an insurance company or a subsidiary of an insurance company, the Corporation—

(A)

shall promptly notify the State insurance authority for the insurance company of the intention to take such lien; and

(B)

may only take such lien—

(i)

to secure repayment of funds made available to such covered financial company or covered subsidiary; and

(ii)

if the Corporation determines, after consultation with the State insurance authority, that such lien will not unduly impede or delay the liquidation or rehabilitation of the insurance company, or the recovery by its policyholders

.

Passed the House of Representatives November 16, 2015.

Karen L. Haas,

Clerk