Insurance regulation in America – playing out of its league

The purpose of this editorial is to consider the effectiveness of the state‐based insurance regulatory system operating in the USA.

The editorial begins by identifying two major challenges recently faced by America's state‐based regulatory system, and argues that state regulators handled these problems inadequately. It then discusses the fundamental weaknesses of the system.

The shortcomings of the state‐based regulatory regime are responsible for its failure to prevent the mortgage‐industry crisis from threatening the solvency of at least one major insurance group.

The editorial argues in favor of federal oversight of insurance in the USA.