Life & Health Insurance Practice Exam 2025 – Complete Study Resource

The correct answer is the Gramm-Leach-Bliley Act, which is significant because it effectively repealed key provisions of the Glass-Steagall Act that had previously separated commercial and investment banking activities. The Glass-Steagall Act, enacted during the Great Depression, aimed to limit the risks associated with bank investments and protect depositors' funds. However, by the late 1990s, there was a growing consensus that these restrictions were outdated and impeded competitiveness in the financial services industry.

The Gramm-Leach-Bliley Act, enacted in 1999, removed the barriers between commercial banks, investment banks, and insurance companies, allowing these institutions to consolidate and offer a wider range of financial services under one roof. This shift was intended to encourage efficiency and innovation in financial markets, as institutions could more freely engage in various types of services without the constraints imposed by the Glass-Steagall Act.

The other options, while related to the financial industry, do not pertain directly to the repeal of the Glass-Steagall Act. The Dodd-Frank Act was implemented after the 2008 financial crisis to enhance consumer protection and reduce risks in the financial system but did not reverse the Gramm-Leach-Bliley Act's repeal of Glass-Steagall