NAMIC’s Advocacy Efforts Pay Off

A Major Victory

Credit-Based Insurance Scoring

In a major victory, NAMIC and other trades defeated a data call to support a proposed multi-state study on credit-based insurance scoring. The industry strongly opposed the study, saying it violated the law because regulators were using their powers to perform market-conduct exams to do research and make laws, rather than enforce them. Former Illinois Insurance Director, Nat Shapo was hired to mount a legal challenge. Led by Missouri, other states involved were Oregon, Alabama, Washington, Nevada, Montana and Indiana.

Underwriting Freedom

NAMIC Publishes Public Policy Paper

The policy debate over insurance price regulation tends to focus on state-administered “rating laws” that require insurers to seek the approval of state insurance departments whenever they wish to raise or lower premiums. A new NAMIC public policy paper explains that price regulation also takes a less direct form: state-imposed underwriting restrictions that curtail the ability of insurers to accurately assess and classify risk. “Government restrictions on underwriting freedom ostensibly guard against unfair business practices and ensure that insurance will be available to meet market demand. In many instances, however, these regulatory interventions only create dysfunctional market conditions that are detrimental to insurance consumers,” wrote Robert Detlefsen, NAMIC public policy director, in The Case for Underwriting Freedom: How Competitive Risk Analysis Promotes Fairness and Efficiency in Property/Casualty Insurance Markets.

Focused National Advocacy Efforts

2004 will be remembered as the year that NAMIC’s state advocacy efforts were resourced to accomplish a bold yet focused national state advocacy agenda. In late 2003, longtime industry advocacy veteran, Tami Stanton, joined NAMIC as the state affairs manager for the Northeast Region. Over the summer, think tank and advocacy organization veteran, Dr. Robert Detlefsen joined NAMIC as the director of public policy. And in late 2004, former property/casualty claims adjuster, subrogation analyst and insurance attorney, Christian Rataj, joined NAMIC as the state affairs manager for the Western Region.

ALEC Adopts Model Law

The Fair Notice and Market Stability Act

In 2004, the American Legislative Exchange Council (ALEC) adopted model legislation prepared by NAMIC. The Fair Notice and Market Stability Act will allow insurers and other regulated companies to rely on each state’s laws without denying access to the courts. Passage by ALEC sends a strong message to the states. ALEC is the nation’s largest bipartisan, individual membership organization of state legislators with more than 2,400 legislator members from all 50 states.

NAMIC Offers Critical Analysis

AIA and PCIAA Distribute NAMIC Public Policy Paper

In The Legal Theory of Disparate Impact Does Not Apply to the Regulation of Credit-Based Insurance Scoring, NAMIC offered a critical analysis of current efforts to extend the disparate impact legal theory to the use of credit-based insurance scoring, exposing the theory’s inherent flaws and highlighting the special difficulties that arise when the theory is applied to situations other than employment discrimination litigation. The American Insurance Association (AIA) and the Property Casualty Insurers Association of America (PCIAA) joined with NAMIC to distribute the paper to policymakers.

NCOIL Market Conduct Surveillance Model Act

NAMIC Applauds Resistance to NAIC Pressure

While NAMIC prefers the original language of the National Conference of Insurance Legislators (NCOIL) market conduct surveillance model act, legislators deserve credit for resisting efforts by the National Association of Insurance Commissioners (NAIC) to eliminate certain provisions relating to a self-evaluative privilege and a provision forcing regulators to prepare a budget for a targeted market conduct examination where the cost is billed to the company. These two provisions have been important to NAMIC membership since day one and NAMIC appreciates the legislators retaining these provisions as part of the conforming amendment process.

Op-Ed Published

NAMIC Appears in General Interest Publications

In page 15, read an op-ed on credit-based insurance scoring written by Public Policy Director Robert Detlefsen and published by the Houston Chronicle in mid-January (page 15). The next week, the Washington Times published an op-ed by Federal Affairs Senior Vice President David Winston (page 7) that describes the threat to state sovereignty that exists under the current system for handling multi-state class action lawsuits, and offers a principled rationale for federal intervention.

Posted: Friday, April 01, 2005 12:00:00 AM. Modified: Thursday, April 14, 2005 1:18:07 PM.

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We are 1,400 property/casualty insurance companies serving more than 135 million auto, home and business policyholders, with more than $196 billion in premiums accounting for 50 percent of the automobile/homeowners market and 31 percent of the business insurance market. We are the largest and most diverse property/casualty trade association in the country, with regional and local mutual insurance companies on main streets across America joining many of the country’s largest national insurers who also call NAMIC their home. More than 200,000 people are employed by NAMIC members.