Actuarial Notes

Annual Report on the Insurance Industry: Completed pursuant to Title V of the Dodd-Frank Wall Street Reform and Consumer Protection Act

By Federal Insurance Office, U.S. Department of the Treasury · U.S. Department of the Treasury · 2024

Study guide: Exam 6U

The Federal Insurance Office's annual report (September 2024) to the President and the House and Senate committees on the insurance industry, submitted under Section 502(a) of the Dodd-Frank Act. It reports the aggregate 2023 financial results of life and health, property and casualty, and health insurers licensed in the United States, begins with an overview of FIO's statutory responsibilities and activities, and concludes with the areas FIO expects to focus on in the coming year.

On the syllabus

  • Exam 6U — objective A3; Sections I, IA and I-B1, the Introduction, the structure and summary of findings, and the FIO overview (the content outline cites the September 2024 report as an online publication).

I Introduction

  • The report is submitted by FIO of the U.S. Department of the Treasury under Section 502(a) of the Dodd-Frank Act, which requires an annual report on the insurance industry to the President, the House Committee on Financial Services and the Senate Committee on Banking, Housing, and Urban Affairs.
  • A The Structure of this Report and Summary of Findings
    • The report begins with an overview of FIO's statutory responsibilities, then summarizes FIO's key activities since its 2023 Annual Report; Section II analyzes the industry's financial performance in calendar year 2023 and condition at December 31, 2023, and Section III concludes with anticipated areas of FIO focus.
    • Overview: the U.S. insurance industry in 2023 remained on a strong financial footing as insurers pivoted from a protracted low interest environment to higher rates, premiums increased and the industry's surplus position improved.
    • The summary of findings covers the L&H sector, the P&C sector and the international marketplace; the United States remained the world's largest single-country insurance market at year-end 2023, with a 45 percent share of global direct premiums written.
  • B Federal Insurance Office Overview and Activities
    • 1 FIO Overview
      • The primary regulators of the business of insurance are the 50 states, the District of Columbia and the five U.S. territories; Title V of the Dodd-Frank Act established FIO within Treasury.
      • FIO advises the Secretary of the Treasury on major domestic and prudential international insurance policy issues and its Director serves as a non-voting member of the Financial Stability Oversight Council (FSOC).
      • FIO is authorized to monitor all aspects of the insurance industry, including access to affordable insurance for traditionally underserved communities, to recommend that FSOC designate an insurer for supervision by the Federal Reserve, to assist in administering the Terrorism Risk Insurance Program, to coordinate federal policy on prudential international insurance matters, to determine whether state insurance measures are preempted by covered agreements, and to consult with the states.
      • FIO is authorized to collect data and information from the insurance industry, including through subpoenas, and to issue reports on all lines of insurance except health insurance.
    • 2 FIO Activities
      • Box 1: IUCRC

II Insurance Industry Financial Overview and Outlook

  • A Domestic Insurance Marketplace Overview and Outlook
    • 1 Financial Performance and Condition Overview
    • 2 Life and Health Sector
      • Box 2: Growth in Annuities Markets and the Retirement Savings Gap
    • 3 Property and Casualty Sector
      • Box 3: Pre-Disaster Mitigation and Insurance
    • 4 Market Performance
    • 5 Domestic Outlook
  • B Capital Markets Activity
    • 1 Financings
    • 2 Mergers & Acquisitions of U.S. Insurers
  • C International Insurance Marketplace Overview and Outlook

III Conclusion

Sources