So, Senator, I guess I would draw a distinction between the creation of capital standards for traditional or current insurance activities, on the one hand, and an assessment of systemic risk on the other.
My own reading of the FSOC process with respect to Prudential and AIG is that there is not a lot of concern about the core insurance activities of those companies.
The concerns were with respect to some nontraditional insurance activities where runnability is more of a concern, and also with respect to things that are not insurance activities of any sort.
I think that is where the analysis would allow one to conclude there is systemic importance.
I personally do not think that the issue of whether there is systemic importance in traditional insurance activities has really been broached, and I am personally not sure we need to broach it.
I mean, my pretty strong presumption would be that there is not.
Mr. FITZPATRICK. Governor Tarullo also noted that AIG and Prudential were designated as systemic not because of their core insurance activities but due to what he called ‘‘nontraditional insurance activities,’’ where runnability is more of a concern, and also with
respect to things that are not insurance activities of any sort. Do you agree with Governor Tarullo that to justify designating an insurance company as an SIFI that one would have to find that the company engages in activities that are not traditional insurance activities and that do pose systemic risk?