SIC 6399 Insurance Carriers, Not Elsewhere Classified

SIC 6399

Establishments providing insurance coverage but not covered by any other insurance category make up the industry classification entitled Insurance Carriers, Not Elsewhere Classified (NEC). Federally supported organizations providing insurance for financial institution deposits make up most of this industry. Other miscellaneous insurers, however, cover everything from pets and trademarks to body parts and automobile warranties.

NAICS CODE(S)

524128

Other Direct Insurance Carriers (except Life, Health, and Medical)

The Federal Deposit Insurance Corporation (FDIC) is the largest organization in this industry. Created by the Banking Act of 1933 following the failure of more than 8,000 banks during the Depression, the FDIC promotes and preserves public confidence in U.S. financial institutions by insuring bank and thrift deposits up to the legal limit of $100,000 per account. In 2005, the FDIC insured more than $3 trillion of U.S. bank and thrift deposits at approximately 9,200 institutions. But the FDIC has other responsibilities besides acting as an insurer. It examines state-chartered banks that are not members of the Federal Reserve System for safety, soundness, and compliance with consumer protection laws. The FDIC may liquidate the assets of failed institutions to reimburse the insurance funds for the cost of failures. It also has the power to set interest rate limits and approve bank mergers.

An independent government agency within the executive branch, the FDIC is run like a private company by a five-member board of directors that includes the Comptroller of Currency, the Director of the Office of Thrift Supervision, and three presidential appointees. The Corporation does not operate on funds appropriated by Congress. Its income is derived from assessments on deposits held by insured banks and from interest on the required investment of its surplus funds in government securities. It also has authority to borrow from the Treasury up to $30 billion for insurance purposes.

Congress passed the FDIC Improvement Act (FDICIA) in 1991. The law instituted a number of agency reforms and gave the FDIC increased power over foreign banks active in the United States. The agency was also affected by a number of federal laws relating to the downsizing of the federal government. The FDIC cut $143 million, or 8 percent, from its budget between 1996 and 1997. Employee compensation was reduced the most...