Tom Sullivan, Former Connecticut Commissioner, Tapped as Fed’s First Insurance Regulator
June 3, 2014 by Jeff Jeffrey
WASHINGTON – The Federal Reserve Board has hired former Connecticut Insurance Commissioner Thomas Sullivan to be its first senior adviser for insurance within the Banking Supervision and Regulation Division. Sullivan, who stepped down as a partner at PricewaterhouseCoopers’s Hartford, Conn. office in May, will enter his new role on June 9.
At the Fed, Sullivan will be responsible for carrying out its new regulatory role for insurance companies that have been designated as systemically important financial institutions. The Dodd-Frank financial reform act charged the Fed with overseeing institutions that could pose a threat to the U.S. financial system.
Currently, the two insurance companies that have received SIFI designations are American International Group Inc. and Prudential Financial Inc. Metropolitan Life Insurance Co. has confirmed it has reached Stage 3 of the Financial Stability Oversight Council’s evaluation process for determining whether it should receive a SIFI designation (Best’s News Service, May 5, 2014). The Fed also has oversight jurisdiction for roughly 10 insurer-owned savings and loan companies.
Sullivan told Best’s News Service there is no existing regulatory regime for either insurer SIFIs or insurer-owned savings and loan companies.
“My role is to help with that,” Sullivan said.
To aid in that process, Sullivan said he will have a staff of insurance industry experts to help him design and implement a regulatory structure for insurer SIFIs. But at this stage, he said he does not know how large his staff will be.
“I need to get in there and work with the fine folks at the Fed to help define and design what it’s all going to look like,” Sullivan said.
Sullivan will also represent the Fed at the International Association of Insurance Supervisors. Last year, the IAIS approved the Fed and the FSOC’s independent insurance representative S. Roy Woodall Jr. to join as members.
Additionally, Sullivan said he expects to work closely with Federal Insurance Office Director Michael McRaith in his new role. He said he and McRaith know each other well because McRaith served as Illinois insurance director while Sullivan was at the Connecticut Insurance Department.
“The FIO itself is not a regulator, as I will be,” Sullivan said. “But it plays an important role in the insurance industry in the United States. Mike and I were colleagues together at the NAIC, so I know him quite well. I envision myself working closely with Mike on issues that are germane to both of us.”
Sullivan added he also intends to work closely with the National Association of Insurance Commissioners in his new role.
“The list of people I will be working and collaborating with is long,” Sullivan said. “But first and foremost is to carry out the Fed’s statutorily defined charge under Dodd-Frank.”
Sullivan, a former executive at Hartford Financial Services Group, was appointed Connecticut insurance commissioner in 2007. He stepped down in 2010 to join PricewaterhouseCoopers.
(By Jeff Jeffrey, Washington Bureau manager: jeff.jeffrey@ambest.com)
