The National Association of Mutual Insurance Companies views the current economic crisis as one of the reasons to thwart efforts to form an optional federal charter, said Chuck Chamness, NAMIC president and chief executive officer.

State regulation has worked well toward solvency, and those who would say that the turmoil of the markets and the insolvency of American International Group would lead to the conclusion that an OFC is needed “are incorrect,” Chamness said last week during the organization’s annual meeting in Philadelphia.

Chamness wrote Congress on September 17 expressing NAMIC’s views on an OFC; feedback has been “positive” and “appreciative,” he said.

NAMIC would like to see the new Congress act quickly on a better version of the National Flood Insurance Program. President Bush has signed legislation extending the NFIP for six months. “We’ll approach those new members of Congress and educate them about the need to reauthorize it and reform it,” he said. That would hopefully include new flood maps and new penalties for financial institutions that don’t enforce the NFIP, he said.

NAMIC’s 1,400 member companies represent some 40 percent of the market by premium, and more than half those members are more than 100 years old — and they’re all “very stable and solid,” Chamness said. PIA’s history as an organization parallels NAMIC’s. From PIA’s inception in 1931 until 1976, PIA was the National Association of Mutual Insurance Agents.

October 7, 2008