The Reinsurance Association of America (RAA) has commended an amendment to a fiscal year 2021 budget document that provides an outline of the House Financial Services Committee’s agenda.
The amendment encourages Federal agencies and departments that hold credit, guarantee or insurance risk that exposes American taxpayers to potential losses, to explore and employ risk transfer to the capital and insurance markets.
It was introduced by Representative Blaine Luetkemeyer with support by Chairwoman Maxine Waters, and has been approved by the House Financial Services Committee.
Luetkemeyer notes the successful risk transfer programs at the Federal Housing Finance Agency, the National Flood Insurance Program, and the Export-Import Bank.
He argued via the amendment that these programs demonstrate that Federal agencies can manage their risks and mitigate potential losses in their portfolios.
“RAA commends Congressman Luetkemeyer and Chairwoman Waters for their continued leadership in supporting transferring risk from Federal programs to the private sector,” said Frank Nutter, President of the RAA.
He added: “Risk transfer programs will improve Federal program risk analysis and management while easing the financial burden for risk now borne by the Federal government and ultimately, the American taxpayer.”
