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S. 798 (114th): Policyholder Protection Act of 2015

The text of the bill below is as of Mar 19, 2015 (Introduced).


II

114th CONGRESS

1st Session

S. 798

IN THE SENATE OF THE UNITED STATES

March 19, 2015

(for himself and Mr. Tester) introduced the following bill; which was read twice and referred to the Committee on Banking, Housing, and Urban Affairs

A BILL

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.

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 such section 5(g) applies 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 such section 5(g).

.

3.

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), by inserting or rehabilitation after orderly liquidation each place such term appears; and

(2)

in section 204(d)(4), by inserting before the semicolon 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 not take such lien if the State insurance authority notified under subparagraph (A) informs the Corporation, in writing, within 15 days of such notice, that the taking of the lien on the assets of such company would have a materially adverse effect on the policyholders of such company

.