U.S. Federal Reserve floats plan to set capital requirements for some insurers

The U.S. Federal Reserve Board unveiled a proposal on Friday that would establish requirements for insurance companies it oversees to set aside capital. The proposed framework would apply to eight U.S. depository institution holding companies that are also “significantly engaged in insurance activities,” the Fed said in a statement. The eight insurers include USAA, TIAA, State Farm, Ameriprise, AAA, Mutual of Omaha, Ohio Farmers and First American. Those companies would be required to build from capital requirements that U.S. state insurance regulators already impose, with minimum requirements for the amount of cash insurers must keep on hand and a buffer on top of that minimum, the Fed said. U.S. state regulators typically oversee insurers, while the Fed supervises a wide range of financial institutions. The eight insurers related to the Fed’s proposal account for a substantial portion of their holding companies’ activity.