Sponsors (6)
The bill strengthens cross-agency coordination, data collection, and regulatory attention to climate-related financial risks—potentially improving system resilience and consumer protections—while imposing significant compliance and administrative costs, creating implementation uncertainty, and risking reduced credit or insurance availability in high-risk areas.
Large banks, insurers, credit unions, and federal/state regulators will have a permanent, cross-agency committee, ongoing OFR research, and regular public reports to identify and coordinate responses to climate-related financial risks, improving overall financial system resilience.
Homeowners and policyholders gain clearer, ZIP-code-level visibility into insurance availability, pricing, and nonrenewal trends, helping people compare premiums, anticipate risks, and make better housing and insurance decisions.
Federal and state supervisors will have more-consistent guidance and coordinated supervisory expectations (via FFIEC, FSOC, and information-sharing), reducing regulatory fragmentation and producing more uniform oversight of climate risk across jurisdictions.
Banks, large credit unions, insurers, and other financial firms will face expanded data-collection, reporting, and compliance obligations to identify and mitigate climate risks, raising operating costs that may be passed on to consumers and taxpayers.
Firms could reduce lending or withdraw insurance coverage in climate-exposed regions, or raise premiums, shrinking availability of credit and insurance for homeowners, small businesses, and residents of high-risk areas.
The new permanent committee, guidance, and expanded criteria may increase regulatory complexity, create ambiguity during implementation, and provoke federal–state tension over perceived federal overreach into state-regulated matters.
Based on analysis of 7 sections of legislative text.
Creates FSOC climate committees, requires banking and insurance regulators to integrate climate financial risk into supervision and SIFI designations, and mandates annual ZIP-code homeowners insurance data reporting.
Official title: Establish the Climate Financial Risk Committee and Climate Financial Risk Advisory Committee on the Financial Stability Oversight Council.
Introduced January 28, 2026 by Tina Smith · Last progress January 28, 2026
Creates a permanent Climate Financial Risk Committee inside the Financial Stability Oversight Council (FSOC), a new Advisory Committee on Climate Risk, and requires federal banking and insurance regulators to incorporate climate-related financial risks into supervision, designation of nonbank SIFIs, and data collection. It directs updates to supervisory guidance for large banks and credit unions, mandates FSOC rule changes for SIFI designations to include climate risk, requires a Federal Insurance Office (FIO) climate risk report, and obligates FIO to collect and publish ZIP-code–level homeowners insurance underwriting data starting with reports for 2023–2024 and annually thereafter.