Joel Ario

Pennsylvania / Oregon Insurance Commissions

Eyes

(p8) - Our job is to follow those complaints and address them in our marketplace and make that marketplace work for consumers at the local level.

NAIC - Joel S. Ario, Insurance Administrator, Oregon Insurance Division, Secretary Treasurer, National Association of Insurance Commissioners

2003 0506 - GOV (House) - Increasing the Effectiveness of State Consumer Protection, Sue W. Kelly (R-NY) --- [BonkNote] --- [PDF-123p,

Carolyn MALONEY (D-NY) - So if Financial Products was walled off and allowed to fail, the insurance portion would be safe and sound, and going forward, is that correct?
Mr. ARIO. Yes, the assets would be there and would be protected. (p48)
Mrs. MALONEY. Thank you.

2009 0318 - GOV (House) - Federal Aid to AIG Insurance, Regulators Panel - [PDF-380p

Carolyn MALONEY (D-NY) How are the insurance businesses of AIG segregated from the AIG Financial Products?
Joel ARIO (NAIC /PA - Insurance Commissioner). Within insurance regulation, there is the strong principle that the assets that are there for the benefit of policyholders are walled off from all other creditors of the company, including the holding company upstream.
- So we believe that the assets of the insurance companies are there for the policyholders and they are protected against all other creditors, including the holding company upstream.
Mrs. MALONEY. So in other words, the risk of default in the life insurance business of AIG is separate from the cross-linked risk of being associated with and dragged down by AIG Financial Products, is that correct?
Mr. ARIO. It is a slightly different question.
- If there are problems at the holding company level, particularly in terms of the rating of the companies, that can create rating issues for the downstream insurance companies, and that is a particularly important issue in the property and casualty side.
- If we are going below the A minus level that we are at now into the Bs, it would have very negative impacts on the insurance company.
  - So there is that linkage.
Mrs. MALONEY. But the linkage is only with the rating companies.
- In other words, they are walled off, they are separate.
- So what would happen if AIG Financial Products was allowed to fail?
  - Would that have an impact on the insurance properties and the insurance assets of AIG?
Mr. ARIO. Not directly on the assets.
- That is more a question for how the rating agencies would look at that issue for the insurance companies.
Mrs. MALONEY. The rating agencies do not have a lot of credibility at this point, so I would rather ask the insurance commissioner. It is my question.
- So if Financial Products was walled off and allowed to fail, the insurance portion would be safe and sound, and going forward, is that correct?
Mr. ARIO. Yes, the assets would be there and would be protected. (p48)
Mrs. MALONEY. Thank you.

2009 0318 - GOV (House) - American International Group’s Impact On The Global Economy: Before, During, And After Federal Intervention, Federal Aid to AIG Insurance, Regulators Panel (CSPAN), Paul Kanjorski (D-PA) --- [BonkNote]

(p8) - Insurance is a different kind of product than either banking or securities or really any of the other financial products out there.
It is a more complex kind of product.
- What kind of policy will be offered to the consumer? What will be the price of the policy? What are the specific policy terms and conditions? What is included, what is excluded from the policy? What does the fine print say? Is a claim valid when it is filed? If it is valid, how much is it worth? These are all questions that are very complicated
They often lead to misunderstandings between consumers and insurers
and they often lead to consumer complaints to our offices.
...
Our job is to follow those complaints and address them in our marketplace and make that marketplace work for consumers at the local level.

-- NAIC - Joel S. Ario, Insurance Administrator, Oregon Insurance Division, Secretary Treasurer, National Association of Insurance Commissioners

2003 0506 - GOV (House) - Increasing the Effectiveness of State Consumer Protection, Sue W. Kelly (R-NY) - [PDF-123p, VIDEO-?] -

House - Committee on Financial Services - Subcommittee on Oversight and Investigations

(p19) - The reason the Federal Government decided to rescue AIG was because of the systemic risk created by Financial Products.
(p19) - To make matters worse, the counterparties to those swaps included many of the world’s leading financial institutions.
- It was to protect those institutions that the Federal Government acted.
(p19) - In Chairman Bernanke’s words, ‘‘We are not doing this to bail out AIG or their shareholders certainly. We are doing this to protect our financial system and to avoid a much more severe crises in our global economy. We know that the failure of major financial firms can be disastrous for the economy. We really had no choice.’’

-- Testimony of the Honorable Joel Ario, Insurance Commissioner, Pennsylvania Insurance Department, On Behalf of the National Association of Insurance Commissioners

Securities lending did not pose systemic risk and would have been resolved without any Federal assistance, but for the Financial Products debacle, which caused the run on the bank that took a net of $20 billion in Federal funds to fully resolve.
It is more than $40 billion out, but $20 billion held by the Federal Government today.

-- Testimony of the Honorable Joel Ario, Insurance Commissioner, Pennsylvania Insurance Department, On Behalf of the National Association of Insurance Commissioners