House Subcommitee to Take Up Insurance Regulatory Legislation
Insurance regulatory reform will dominate the agenda at a July 9 mark-up session of the U.S. House Financial Services Subcommittee on Capital Markets and Insurance.
Having devoted numerous hours to regulatory reform proposals over the course of a half-dozen hearings, the panel will take up three of those proposals with an eye to move them to the floor before close of the 110th Congress. Topping the list is H.R. 5840, the Insurance Information Act, which would establish an Office of Insurance Information within the U.S. Treasury Department.
Sponsored by Subcommittee Chairman Paul Kanjorski, D-Pa., the bill ponders creating a federal insurance expert charged with monitoring all lines of insurance, except health insurance, by gathering and analyzing publicly available data. The office also would be charged with establishing federal policy on international insurance matters, and could in certain cases pre-empt state law where it may violate international agreements.
Although opposed by the National Conference of Insurance Legislators, the bill has received conditional support from the National Association of Insurance Commissioners. The NAIC also is bestowing its blessing on the National Association of Registered Agents & Brokers Reform Act, proposing a privately administered national system to process nonresident licensing for out-of-state insurance agents and brokers.
Strongly supported by agents groups like the National Association of Insurance and Financial Advisors and the Independent Insurance Agents & Brokers of America, H.R. 5611's backers expect it to be altered to ensure state regulators have a majority of seats on the NARAB board. Chartered as a nonprofit organization, NARAB would require members to undergo fingerprinting and criminal background checks, and meet association standards for education and training.
"The announcement that Insurance Subcommittee Chairman Kanjorski will be marking up the NARAB II legislation is welcome news," said Charles Symington, the Big I's senior vice president government affairs. "The Big I strongly supports the bill, which is our number one federal legislative issue this Congress."
Under the Increasing Insurance Coverage Options for Consumers Act, the final bill being considered by the panel, the 22-year-old Liability Risk Retention Act would be amended to allow commercial property insurance to be written through risk-retention groups. H.R. 5792 also would apply a set of minimum solvency and governance requirements to domiciliary states, requiring RRGs to adopt stronger disclosure and safety and soundness standards. The groups would be required to hold written charters, independent audit committees, and boards with a majority of independent directors.
Source: Source: BestWire Services | Published on July 8, 2008
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