Insurers Have Asked for Discount Window Access Before

This passage from a 1999 article by Bert Ely claims (somewhat cryptically) that insurance companies approached the Fed about emergency loans in the '70s and '80s, which suggests that an emergency loan to a large insurance company like AIG might have been what Congress had in mind when it amended the "unusual and exigent circumstances" clause in 1991 (via Westlaw):

While banks pay for the entire cost of their federal safety net, ... large non-bank financial firms do not pay for their federal financial safety net, which is the ability to borrow at the Fed's discount window in "unusual and exigent circumstances." Although the Fed has not lent in such circumstances for at least fifty years, it could lend to a large insurance company or investment banking firm facing severe liquidity problems. The importance of this standby lending authority for the Fed was evidenced by a little-noticed provision in FDICIA (Sec. 473, Emergency Liquidity) which effectively broadened the types of collateral which the Fed could accept in lending to non-bank firms to include marketable securities. This amendment reportedly was sparked by the liquidity problems some securities firms faced in the aftermath of the 1987 stock market crash. The report accompanying the Senate version of FDICIA made clear that this amendment to 12 U.S.C. Section 343 was intended to make it easier for the Fed to lend to temporarily illiquid investment banking firms.

Unpublished reports also indicate that there have been times, specifically in the mid-1970s and the late 1980s, when insurance companies suffering liquidity problems approached the Fed about borrowing at the discount window. According to these reports, the Fed did not lend to these insurers, but that does not mean the Fed could not have lent to them. That insurers occasionally face liquidity crises illustrates one of the great weaknesses of the state guaranty funds for insurers—the lack of an equivalent to the Fed's discount window.

The article is titled, "Revisiting an Old Debate: Do Banks Receive a Federal Safety Net Subsidy?", and was published in the November 1999 issue of Banking Policy Report. I can't find a non-gated link, but for those of you with Westlaw access, the citation is 18 No. 21 BNKPR 1.