Congressional Action on Proposed Federal Consumer Financial Protection Agency

For many months, NAMIC has engaged in aggressive advocacy work with both the administration and Congress to prevent the inclusion of all property/casualty insurance products in any new federal financial consumer protection agency created in response to the current economic crisis.

These advocacy efforts have been largely successful. Legislation introduced in the House of Representatives that would create the Consumer Financial Protection Agency (CFPA) excluded most property/casualty insurance lines from the jurisdiction of the proposed agency. However, those insurers that underwrite title, mortgage, and credit insurance would still be affected.

On Wednesday, October 14, the House Financial Services Committee will meet to work on H.R. 3126, the Consumer Financial Protection Agency Act. In addition to joining with the business community as a whole in opposing the overall concept of a new federal consumer protection agency, NAMIC is specifically working to have the three remaining lines of insurance excluded as well.

This legislation contains a general exclusion of insurance, but includes mortgage, title, and credit insurance. NAMIC believes that the fact that some insurance lines cover those risks involved in a credit transaction does not alter the basic nature of the insurance product: it is a promise to provide protection in the event of a specified event. No types of insurance should be included within the CFPA mandate – including mortgage, title, and credit insurance.

We have been working closely with NAMIC member CUNA Mutual Group to educate members of Congress and their staff about these three lines of insurance and why they too should be excluded from the CFPA. NAMIC and CUNA Mutual have canvassed Capitol Hill in support of these efforts and have been working with a member of the House Financial Services Committee, Rep. Gwen Moore, D-Wis., to reach this goal.

As a result, Rep. Moore will offer an amendment at the markup that will remove mortgage, title, and credit insurance from the legislation. This amendment has been greeted with support by the insurance industry and there have been indications of broad bipartisan support from members of the committee.

NAMIC is continuing its outreach in the hours before the committee meets on Wednesday to ensure that every member of the committee understands the amendment’s importance and will vote for its adoption.

Please direct any questions to Dylan Jones.