Tags: Beaman | MetLife | lawsuit | government

Steve Beaman: MetLife Will Have 'Difficult' Time in Lawsuit

By    |   Tuesday, 13 January 2015 06:42 PM

MetLife insurance company won't have it easy in its lawsuit against the federal government, Steve Beaman, chairman of the Society to Advance Financial Education, told Newsmax TV.

MetLife sued Tuesday over the Financial Stability Oversight Council's decision to designate the firm as a systemically important financial institution, subjecting it to stricter regulation under the Dodd-Frank financial reform law.

"It's going to be difficult certainly for MetLife," Beaman told the "MidPoint" show on Newsmax TV.

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"This is part of the Dodd-Frank legislation, and the regulators got hurt and the government got hurt by . . . insurance companies being part of that entire mortgage-backed meltdown that we had [in 2008]. So they've got a tough battle."

But on the bright side for MetLife, "the regulatory system is not really set up for the Federal Reserve to handle the insurance companies. So this will be an interesting legal battle to watch."

If the designation sticks, "it will make insurance products more expensive, that's what regulations do," Beaman said. "Whether it would enhance stability or not depends on how the regulators do it. The jury's out on that."

It's inarguable that "MetLife is one of these great big players, too big to fail," he said. "If they take risks that are systemic in the financial world, we're going to end up bailing them out. So you can't argue with the government's attempt to try to regulate it a bit."

Setting an even playing field for regulation on insurance firms won't be simple, Beaman said. The Fed is used to setting reserve requirements for banks. But, "insurance companies don’t' work like that," he notes.

Insurance companies have traditionally been regulated at the state level, but "we now have these big multistate insurers" for financial products, including life insurance, Beaman said. "It's going to be an interesting battle to see where the government comes down on this."

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MetLife insurance company won't have it easy in its lawsuit against the federal government, Steve Beaman, chairman of the Society to Advance Financial Education, told Newsmax TV.
Beaman, MetLife, lawsuit, government
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2015-42-13
Tuesday, 13 January 2015 06:42 PM
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