NAIC Backs Bill to Abolish FIO, Reinforce State Insurance Oversight

The National Association of Insurance Commissioners (NAIC) has endorsed the newly introduced McCarran-Ferguson Restoration Act, a congressional bill that would eliminate the Federal Insurance Office (FIO) and reaffirm the states' role as the primary regulators of insurance in the United States.

Introduced by US Representative Troy Downing of Montana, the legislation would dissolve the FIO, which was created in 2010 within the Department of the Treasury. In its place, the bill proposes establishing a US insurance representative—a nonregulatory position appointed by the Treasury secretary—to handle the department's international insurance engagement and assist in the administration of the Terrorism Risk Insurance Act.

"State insurance regulators strongly support Rep. Troy Downing's McCarran-Ferguson Restoration Act because it restores the proper balance between the states and the federal government," NAIC President and Virginia Insurance Commissioner Scott A. White said. "Insurance regulation has always been, and should always remain, a state responsibility. This legislation eliminates a federal office that conflicted with that framework, while preserving a focused, non-regulatory role for Treasury to engage internationally and defend the US sector and system of state-based supervision."

The bill would also give voting rights on the Financial Stability Oversight Council (FSOC) to the state-based insurance representative. Currently, state insurance regulators are the only primary financial regulators on FSOC who do not have a vote.

The NAIC has consistently advocated for preserving state-based regulation, a position rooted in the McCarran-Ferguson Act of 1945. In 2025, the organization released a video celebrating the 80th anniversary of the law, in which members explained how state-based oversight promotes consumer protection and tailored regulatory solutions.