WASHINGTON (December 2, 2009) – The National Association of Mutual Insurance Companies (NAMIC) recognized the House Financial Services Committee for its work on legislation it approved today establishing a Federal Insurance Office within the Department of the Treasury.
“This legislation has come a long way since the summer, when we had a number of major concerns with the broad powers granted to the office,” said Jimi Grande, senior vice president of federal and political affairs for NAMIC. “In addressing those concerns, the legislation has moved back towards its original purpose of providing insurance expertise and information to federal policymakers.”
Originally introduced by Rep. Paul Kanjorksi, D-Pa., last spring and supported by NAMIC, the bill, H.R. 2609 would have created an Office of Insurance Information to provide policymakers with the resources and information they need in making policy decisions. However, changes were made during the summer to bring the bill more in line with the Office of National Insurance (ONI) proposed by the Obama Administration that would have granted extremely broad powers to the office and increased the likelihood that it could ultimately become a de facto federal regulator. NAMIC opposed this version and worked with the committee to clarify and revise the problematic aspects of the bill.
The bill now contains specific language that the bill does not establish a supervisory or regulatory authority over the business of insurance and bars the FIO from pre-empting state insurance laws governing rates, premiums, coverage requirements, antitrust laws, underwriting or sales practices. “This clear prohibition of regulatory activity respects the primacy of the state-based insurance regulatory system while still providing a nationwide view of the insurance industry to federal policymakers,” Grande said.
Additionally, subpoena authority given to the office under the administration’s proposal was removed. In the version passed by the committee, the FIO can request data from an insurer only after first checking with state regulators and the National Association of Insurance Commissioners that the required information is not already publicly available. Also, language proposed by the administration providing the office with broad authority to enter into international trade agreements has been clarified to require cooperation from the U.S. Trade Representative and consultation with Congress.
“We applaud the work of Rep. Kanjorski, Chairman Frank and the other committee members to ensure the office will serve its intended purpose as a source of information rather than as a regulatory body.”
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