Sponsors (15)
The bill centralizes climate-related financial data and strengthens supervision to reduce systemic risk and improve transparency, but it imposes new compliance costs, risks insurance market disruptions and privacy concerns, and may spur political, state–federal, and legal tensions.
State and federal financial regulators (and FSOC) will receive centralized, regular climate-risk analysis and granular data that improves detection and monitoring of systemwide climate-related financial threats, strengthening oversight and reducing the likelihood of cascading financial losses.
Large banks and credit unions (and designated SIFIs) will be required to identify and mitigate climate-related credit, liquidity, market, operational, and reputational risks, improving resilience of major financial institutions and protecting depositors and taxpayers from climate-driven failures.
Insurance markets gain clearer, more localized (ZIP-code level) underwriting and nonrenewal data and public reports, giving homeowners, businesses, and state regulators better information to assess local climate exposure and to plan for insurance availability and pricing.
Banks, insurers, and other supervised firms will face expanded compliance, reporting, and risk-management costs to satisfy new climate-risk data, disclosure, and supervisory expectations, costs that may be passed through to customers in fees, reduced lending, or higher premiums.
Tighter underwriting, capital, and supervisory responses plus public localized data could prompt insurer withdrawals or nonrenewals in high‑risk areas, reducing coverage availability and possibly depressing property values for affected homeowners and communities.
Requiring and publishing granular ZIP‑code underwriting and nonrenewal data risks privacy and competitive harms (re‑identification or sensitive market exposure), raising concerns for homeowners and insurers despite PII exclusions.
Based on analysis of 7 sections of legislative text.
Creates FSOC climate committees, requires banks and insurers to integrate climate financial risk into supervision, updates SIFI rules, and mandates zip-code homeowners insurance data reporting.
Introduced January 27, 2026 by Sean Casten · Last progress January 27, 2026
Creates a standing Climate Financial Risk Committee and an external Advisory Committee inside the Financial Stability Oversight Council to coordinate and assess climate-related financial risks. It directs federal financial regulators to update supervision and guidance to incorporate climate risks, requires FSOC to include climate risk in SIFI determinations, and orders the Federal Insurance Office to produce reports and collect zip-code–level homeowners insurance underwriting data for climate risk analysis. The measure focuses on improving data, coordination, and supervision across banking, insurance, and nonbank financial oversight to identify and mitigate credit, market, liquidity, operational, and reputational risks from climate change. It also encourages international coordination with global climate‑finance bodies.