The Property Casualty Insurers Association of America (PCI) continues to express reservations about the current version of H.R. 5840. PCI says preemption should occur through legislative action, not administrative action by the Treasury, as provided in the bill.

“Preemption of state laws, if necessary, should be accomplished by legislative action, not through an administrative procedure,” said David A. Sampson, PCI’s president and CEO. “The McCarran-Ferguson Act provides that the states control insurance governance in the absence of a federal law explicitly addressing the business of insurance. If a situation is created in which an administrative procedure, not a law, can inadvertently overturn state statutes, then insurers could lose the important regulatory certainty that is provided under McCarran-Ferguson.”

PCI’s board of governors has not yet taken a position on H.R. 5840.

September 3, 2008