In January 2025, former President Donald Trump signed executive order 14192, titled “Unleashing Prosperity Through Deregulation.” This order significantly ramps up his previous deregulatory agenda by requiring that for every new federal regulation introduced, at least ten existing ones must be removed. It’s a dramatic shift from the earlier “two-for-one” rule—and one that’s already stirring debate across industries, especially insurance.
At its core, the executive order 14192 aims to boost economic growth and encourage innovation. But for insurance companies, it presents both opportunities and risks. With fewer federal rules to follow, insurers could enjoy more operational flexibility. At the same time, the lack of clear regulatory guardrails means firms must take a closer look at how they manage risk in this less structured environment.
How the Industry Is Reacting
For some companies, particularly those overwhelmed by compliance costs, this deregulation push is welcome news. They see it as a chance to streamline operations, cut overhead, and focus on growth.
But rolling back regulations isn’t always straightforward. Many of the proposed repeals are already facing legal challenges, and the process of removing federal rules involves complex procedures and time-consuming reviews.
This shift has sparked debate among business leaders and watchdog groups alike. Supporters argue that less government oversight encourages efficiency and smart self-regulation. They subscribe to the idea that less interference allows businesses to innovate and adapt more quickly to market demands.
On the other side, groups like ShareAction and the Interfaith Center on Corporate Responsibility (ICCR) caution that cutting too much red tape can have serious downsides. They believe regulation plays a vital role in holding companies accountable—especially when it comes to environmental responsibility, social impact, and ethical business practices.
The conversation really boils down to balance: How do we promote economic freedom without sacrificing the guardrails that protect consumers, employees, and the broader economy?
Lessons from the Past: When Deregulation Backfired
The insurance sector has been through this before. Deregulation has, at times, created more problems than it solved.
One notable example is the U.S. liability insurance crisis in the 1980s. Between 1984 and 1987, premiums for general liability insurance tripled—from $6.5 billion to $19.5 billion. Nonprofits, municipalities, and small businesses were hit hard, often left without coverage or forced to pay exorbitant rates. The lack of strong regulatory oversight contributed to this market upheaval.
Another major example is the Commodity Futures Modernization Act of 2000. This legislation excluded credit default swaps (CDS) from regulatory oversight—despite their similarities to insurance products. As a result, financial institutions were able to trade these complex instruments without adequate supervision or capital reserves. When the housing bubble burst and mortgage defaults surged, the unchecked CDS market played a central role in the 2008 financial collapse.
Internationally, we’ve seen similar effects. In Norway, financial deregulation in the late 1980s led to a surge in risky lending. When oil prices plummeted, the result was a full-blown banking crisis. Again, the lesson was clear: without careful oversight, markets can spiral out of control.
Looking Ahead: What’s Next for Insurance Firms?
It’s still too early to tell exactly how executive order 14192 will play out in the insurance industry. But one thing is certain—this level of deregulation requires companies to step up their internal risk strategies.
With fewer rules to lean on, insurers must build stronger internal controls, audit systems, and ethical guidelines. Proactive risk management will be critical to avoid pitfalls that looser regulation could invite.
Ultimately, the industry’s success in this new environment will depend on its ability to self-regulate—balancing innovation with responsibility, and profitability with long-term stability.
