H.R. 7246

[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[H.R. 7246 Introduced in House (IH)]

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119th CONGRESS
2d Session
H. R. 7246

To establish the Climate Financial Risk Committee and Climate Financial 
Risk Advisory Committee on the Financial Stability Oversight Council.

_______________________________________________________________________

IN THE HOUSE OF REPRESENTATIVES

January 27, 2026

Mr. Casten (for himself, Ms. Castor of Florida, Mr. Lieu, Mr. Mullin, 
Ms. Bonamici, Ms. Ansari, Mr. Huffman, Ms. Stansbury, Ms. Velazquez, 
Ms. Brownley, Mr. Evans of Pennsylvania, Mr. Min, and Mr. Goldman of 
New York) introduced the following bill; which was referred to the 
Committee on Financial Services

_______________________________________________________________________

A BILL

To establish the Climate Financial Risk Committee and Climate Financial 
Risk Advisory Committee on the Financial Stability Oversight Council.

Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

This Act may be cited as the ``Addressing Climate Financial Risk 
Act of 2026''.

SEC. 2. FINANCIAL STABILITY OVERSIGHT COUNCIL COMMITTEES ON CLIMATE 
FINANCIAL RISK.

(a) In General.--Subtitle A of the Financial Stability Act of 2010 
(12 U.S.C. 5321 et seq.) is amended by inserting after section 121 (12 
U.S.C. 5331) the following:

``SEC. 121A. CLIMATE FINANCIAL RISK COMMITTEE.

``(a) Establishment.--There is established in the Council the 
Climate Financial Risk Committee, which shall--
``(1) support the Council in identifying priority areas for 
assessing and mitigating climate-related risks to the financial 
system;
``(2) serve as a coordinating body to share information, 
facilitate the development of common approaches and standards, 
and facilitate communication across Council member agencies;
``(3) collaborate with the Office of Financial Research to 
compile climate and financial data from public sources and from 
member agencies of the Council, provide analytical tools and 
software, and otherwise assist member agencies of the Council 
in jointly analyzing potential financial stability risks; and
``(4) provide updates to the Council on the status of the 
efforts of the Council and its member agencies to identify and 
address climate financial risk, including related to--
``(A) incorporating climate financial risk into 
regulatory and supervisory programs;
``(B) improving data and methodologies;
``(C) enhancing climate-related disclosures; and
``(D) assessing climate-related risks to the 
financial stability of the United States.
``(b) Membership.--The Climate Financial Risk Committee shall 
consist of staff representatives from each of the member agencies of 
the Council and shall be led by the Deputy Assistant Secretary of the 
Council.
``(c) Restriction on Termination.--The Climate Financial Risk 
Committee may not be terminated or modified except pursuant to an Act 
of Congress.

``SEC. 121B. ADVISORY COMMITTEE ON CLIMATE RISK.

``(a) Establishment.--There is established in the Council the 
Advisory Committee on Climate Risk, which shall--
``(1) consult and assist the Council with gathering 
information on, conducting analysis of, and making 
recommendations to identify, assess, and mitigate climate-
related risks to the financial system, and other duties that 
the Climate Financial Risk Committee or the Council may assign; 
and
``(2) meet with the Council on a bimonthly basis.
``(b) Membership.--The Advisory Committee shall consist of not more 
than 30 members as follows:
``(1) 8 members who are climate science experts with a 
demonstrated record of peer-reviewed publications and 
professional contributions to climate modeling, climate 
financial risk assessment, or related areas, of whom--
``(A) 2 shall be appointed by the Secretary of 
Energy;
``(B) 2 shall be appointed by the Administrator of 
the Environmental Protection Agency; and
``(C) 4 shall be appointed by the Director of the 
National Science Foundation.
``(2) 8 members appointed by the Council who are experts in 
climate economics or climate financial risk, of whom not fewer 
than one member is an expert in one of the following areas:
``(A) Insurance.
``(B) Capital markets.
``(C) Banking.
``(D) International financial markets.
``(E) Housing finance.
``(F) The perspective of asset owners.
``(3) 2 members from non-governmental research institutions 
that offer expertise in environmental or clean energy policy, 
appointed by the Council.
``(4) 2 members from consumer advocacy or labor union 
groups, appointed by the Director of the Consumer Financial 
Protection Bureau.
``(5) 4 members from investor networks or shareholder 
advocacy groups, appointed by the Chairman of the Securities 
and Exchange Commission.
``(6) Relevant stakeholders from the financial services 
industry, commercial businesses, or other organizations, which 
shall not include any stakeholders from the oil or gas 
industry.
``(c) Term.--The members of the Advisory Committee shall be 
appointed for 3-year terms, except that the initial terms of the first 
members of the Advisory Committee shall be staggered so that--
``(1) 8 members serve terms of 3 years;
``(2) 8 members serve terms of 2 years; and
``(3) 8 members serve terms of 1 years.
``(d) Restrictions on Removal.--A member of the Advisory Committee 
may not be removed prior to the expiration of the term of such member 
unless \2/3\ of the heads of the member agencies of the Council vote in 
favor of such removal.
``(e) Consultation.--The Council shall consult with the Advisory 
Committee in carrying out the requirements of this section.
``(f) Member Agencies.--Each member agency should develop and make 
publicly available a strategy to identify and mitigate climate 
financial risk within the jurisdiction of the member agency.
``(g) Coordination.--The Council shall--
``(1) facilitate the sharing of best practices on 
addressing climate financial risk across agencies with members 
serving on the Advisory Committee; and
``(2) assign the Office of Financial Research to conduct 
ongoing research into climate financial risk.
``(h) Inclusion in Annual Report.--The Council shall include a 
section on climate financial risk in--
``(1) the annual report of the Council to Congress; and
``(2) if relevant, in any other report to Congress.

``SEC. 121C. REPORT ON CLIMATE FINANCIAL RISK.

``Not later than 270 days after the date of enactment of this 
section, and annually thereafter, the Council shall, in coordination 
with the Advisory Committee on Climate Risk established under section 
121B and the Climate Financial Risk Committee established under section 
121A, publish a report that--
``(1) assesses--
``(A) the potential impact of climate-related risks 
on the financial stability of the United States;
``(B) the extent to which Federal and State 
financial regulatory agencies have sufficient expertise 
on climate financial risk;
``(C) the quality of data available to Council 
members to properly assess climate financial risk and 
any gaps in data that exist;
``(D) the extent to which property and casualty 
insurance availability and affordability trends are 
affecting credit markets, housing finance, and 
financial stability;
``(E) the extent to which nonbank financial 
companies and large, interconnected bank holding 
companies supervised by the Board of Governors are 
engaging in safe and sound management of climate 
financial risks;
``(F) the degree of coordination among Federal and 
State financial regulatory agencies on climate 
financial risk;
``(G) the degree of coordination by Federal and 
State financial regulatory agencies with international 
financial regulatory authorities on climate financial 
risk;
``(H) how climate-related disclosure requirements 
in the United States compare to similar disclosure 
regimes in other countries; and
``(I) any other areas the Council determines 
important; and
``(2) provides recommendations based on the assessments 
conducted under paragraph (1) to Federal and State financial 
regulatory agencies and to Congress on how to improve the 
ability of the financial regulatory system in the United States 
to identify and mitigate both the short- and long-term 
financial risks associated with climate change.''.
(b) Technical and Conforming Amendment.--The table of contents of 
the Dodd-Frank Wall Street Reform and Consumer Protection Act in 
section 1(b) of that Act is amended by inserting after the item 
relating to section 121 the following:

``Sec. 121A. Climate Financial Risk Committee.
``Sec. 121B. Advisory Committee on Climate Risk.
``Sec. 121C. Report on climate financial risk.''.

SEC. 3. UPDATE ON SUPERVISORY GUIDANCE ON CLIMATE FINANCIAL RISK.

(a) Definition.--In this section, the term ``Federal banking 
agency'' has the meaning given the term in section 2 of the Dodd-Frank 
Wall Street Reform and Consumer Protection Act (12 U.S.C. 5301).
(b) Update.--Each Federal banking agency and the National Credit 
Union Administration shall update applicable supervisory guidance to 
include climate financial risk, including credit, liquidity, market, 
operational, and reputational risk to ensure that each institution 
supervised by the Federal banking agency or the National Credit Union 
Administration, as appropriate, with greater than $50,000,000,000 in 
assets appropriately identify and mitigate climate financial risk.
(c) Coordination.--The Financial Institutions Examination Council 
shall ensure that the guidance updated under subsection (b) is--
(1) appropriately coordinated among the Federal banking 
agencies and the National Credit Union Administration; and
(2) shared with State regulators.

SEC. 4. UPDATE NONBANK SIFI DESIGNATION GUIDANCE.

The Financial Stability Oversight Council shall update subpart B of 
part 1310 of title 12, Code of Federal Regulations, to specify how the 
Council will incorporate climate financial risk into determinations 
described in that subpart.

SEC. 5. FEDERAL INSURANCE OFFICE REPORT ON INSURANCE REGULATION AND 
CLIMATE FINANCIAL RISK.

Not later than one year after the date of enactment of this Act, 
the Federal Insurance Office shall publish a report, which may be 
submitted along with the report described in section 6, that--
(1) assesses the potential impact of climate financial risk 
on the insurance sector in the United States;
(2) provides an update on the implementation of 
recommendations made by the 2023 report of the Federal 
Insurance Office titled ``Insurance Supervision and Regulation 
of Climate-Related Risks''; and
(3) recommends ways to modernize and improve regulation and 
supervision of climate financial risk by the insurance sector 
in the United States.

SEC. 6. FEDERAL INSURANCE OFFICE DATA COLLECTION ON CLIMATE-RELATED 
RISKS.

(a) In General.--Not later than one year after the date of the 
enactment of this Act, the Federal Insurance Office, in consultation 
with the National Association of Insurance Commissioners and State 
insurance commissioners, shall publish a report on the homeowners 
insurance underwriting data described in subsection (b) for calendar 
years 2023 and 2024 to assess climate-related risks across State 
insurance markets and how such risks could impact the financial 
stability of the United States.
(b) Data Described.--The data described in this subsection--
(1) shall be disaggregated by zip code;
(2) shall include granular data on premiums, policies, 
claims, losses, limits, deductibles, non-renewals, and 
cancellations, consistent with the information requested under 
the ``Federal Insurance Office Climate-Related Financial Risk 
Data Collection for U.S. Homeowners Multi-Peril Underwriting 
Data'' (88 Fed. Reg. 75380) as modified by the most recent 
National Association of Insurance Commissioners Property & 
Casualty Insurance Market Intelligence Data Call; and
(3) shall be collected directly by the Federal Insurance 
Office from insurance companies, across all lines of business 
of such insurance company, pursuant to section 313 of title 31, 
United States Code.
(c) Dissemination.--Upon request, the Federal Insurance Office 
shall provide to the Committee on Financial Services of the House of 
Representatives, the Committee on Banking, Housing, and Urban Affairs 
of the Senate, or the State insurance commissioner with regulatory 
authority over an insurance company the report required under 
subsection (a), including the data described in subsection (b).
(d) Form.--The Federal Insurance Office shall ensure that the 
report required under subsection (a) does not include any personally 
identifiable information.
(e) Subsequent Reports.--Not later than 180 days after December 31, 
2025, and annually thereafter, in accordance with the requirements of 
this section, the Federal Insurance Office shall make publicly 
available a report on the homeowners insurance underwriting data 
described in subsection (b) for the calendar year preceding the date of 
the report.

SEC. 7. SENSE OF CONGRESS RELATING TO IMPROVING GLOBAL COORDINATION.

It is the sense of Congress that relevant Federal financial 
regulatory agencies and the Department of the Treasury, including the 
Federal Insurance Office, as applicable, should--
(1) join the Network for Greening the Financial System and 
other international organizations focused on climate financial 
risk;
(2) formally join the Task Force on Climate-Related 
Financial Risks of the Basel Committee on Banking Supervision; 
and
(3) work with international regulators on climate financial 
risk whenever possible, consistent with United States law.
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