2013 0613 - GOV (House) - The Impact of International Regulatory Standards on the Competitiveness on US Insurers - PDF-164p

• (p12) - Mr. CLEAVER: What went wrong, and what can you tell me about how we can make sure that nothing like that happens again? Senator?
• Mr. NELSON: I would say that only perhaps in a misunderstood way is AIG looked at as an insurance company problem, because the insurers under the holding company were all solvent, were financially regulated by various States, and there weren’t any problems with stability and solvency with the insurance operations, but the fact that the holding company became a thrift holding company and was subject to other, to jurisdictional regulation at the Federal level, which would have been, I suppose, what they call group or consolidated supervision, but the insurers themselves were all solvent because they were regulated by the States. It was the holding company problem that has now, I hope, been solved at least in part because the thrift regulatory system has been disbanded and moved into another operation. So I think that is what you would have to say, that it was not an insurance failure in any sense.
• Mr. CLEAVER. Mr. Woodall?
• Mr. WOODALL. Speaking from a retro type position, too, I think it emphasizes what he said, the fact that what triggered it was activities going on at financial products in the United States.