What is the impact of the "Federal Insurance Office" on surplus lines?

The Federal Insurance Office (FIO) plays a significant role in the oversight of the insurance industry, particularly in terms of monitoring systemic risk. This involves assessing the overall health and stability of the insurance sector, which includes identifying potential threats that could impact the financial stability of the institutions within the industry. By monitoring systemic risk, the FIO helps to ensure that the insurance market, including surplus lines, remains stable and resilient to shocks, benefiting policyholders and the economy as a whole.

This function is crucial as it helps to maintain confidence in the insurance industry, fostering a stable environment for both standard and surplus lines. It's important to note that while the FIO has substantial oversight responsibilities, it does not set premium rates or directly regulate surplus lines agents. Instead, it focuses on broader issues that could affect the market's performance and viability.