LevonP
02-17-2009, 04:10 PM
Reps. Melissa Bean (D-Ill.) and Ed Royce (R-Calif.) said last week they are planning to introduce the National Insurance Consumer Protection and Regulatory Modernization Act shortly after the President’s Day recess, according to A.M. Best. The pair said the updated bill reflects concerns raised by the status of the economy and issues surrounding national insurer American International Group.
Bean and Royce are co-sponsors of The National Insurance Act (HR 3200), which would create an optional federal charter for insurers. In January, the pair joined five other authors of a letter sent to new U.S. Treasury Secretary Timothy Geithner, calling for a department in his office or another entity “to fill a void on insurance oversight and expertise at the federal level.”
Features of their new bill, according to published reports, include creating a new national office of insurance with a consumer affairs office in each state; creating a new systematic risk regulator to monitor insurers; and giving the national insurance office the authority to access financial records of all affiliates within a holding company structure.
The law would also incorporate consumer protection models from the National Association of Insurance Commissioners into the national insurance office for more uniform oversight across the country, according to A.M. Best.
The National Association of Professional Insurance Agents said it believes Congress should focus on the primary obligation of correcting “the current, failed federal oversight system.”
“Diverting Congressional attention to restructuring the business of insurance or its oversight is a distraction from fixing the problems in the financial markets that resulted from federal failures,” the group said in a statement.
The PIA added that it has concerns about the legislation that “could bring about the de-facto federalization of insurance regulation as it simultaneously guts the existing state-based system of insurance regulation.”
“Consumers are already well protected by the modern, effective system of regulatory supervision by the states. In fact, the state-based system of insurance regulation has been a model for successful regulation since the inception of the current financial crisis,” the group said.
Bean and Royce are co-sponsors of The National Insurance Act (HR 3200), which would create an optional federal charter for insurers. In January, the pair joined five other authors of a letter sent to new U.S. Treasury Secretary Timothy Geithner, calling for a department in his office or another entity “to fill a void on insurance oversight and expertise at the federal level.”
Features of their new bill, according to published reports, include creating a new national office of insurance with a consumer affairs office in each state; creating a new systematic risk regulator to monitor insurers; and giving the national insurance office the authority to access financial records of all affiliates within a holding company structure.
The law would also incorporate consumer protection models from the National Association of Insurance Commissioners into the national insurance office for more uniform oversight across the country, according to A.M. Best.
The National Association of Professional Insurance Agents said it believes Congress should focus on the primary obligation of correcting “the current, failed federal oversight system.”
“Diverting Congressional attention to restructuring the business of insurance or its oversight is a distraction from fixing the problems in the financial markets that resulted from federal failures,” the group said in a statement.
The PIA added that it has concerns about the legislation that “could bring about the de-facto federalization of insurance regulation as it simultaneously guts the existing state-based system of insurance regulation.”
“Consumers are already well protected by the modern, effective system of regulatory supervision by the states. In fact, the state-based system of insurance regulation has been a model for successful regulation since the inception of the current financial crisis,” the group said.