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Insurance Regulation a Key Issue for the House Financial Services Committee

House Financial Services Committee Chairman Representative Mike Oxley (R-OH) said that insurance regulation reform, to include proposals for an optional federal charter, would be very...
February 11, 2003

House Financial Services Committee Chairman Representative Mike Oxley (R-OH) said that insurance regulation reform, to include proposals for an optional federal charter, would be very high priority for his committee. He further stated that he did not think the Committee would be able to address the issue until after the April Congressional recess.

The Committee's Ranking Member, Representative Barney Frank (D-MA), agreed that optional federal charter was an important issue. However, he did not think that federal regulation would occur due to the division that exists within the industry on this issue. He also stated the power of independent agents, one of the three most powerful groups in the financial services arena, as a key ingredient. Calling votes more important to Members than money, he also indicated that independent agents have a tremendous grassroots network.

Optional federal charter will be one of the issues PIA members will discuss with their Representatives and Senators during the 2003 PIA Federal Legislative Summit, scheduled for April 3rd.

What It Means to Agents:  PIA opposes the concept of an optional federal charter because, in reality, it would create two separate regulatory tracks for insurance oversight (state vs. federal) and because it would add a 56th separate, independent insurance jurisdiction that does nothing for overall insurance regulation reform and uniformity. Instead, PIA supports continuing the expanded use of national standards for uniformity, in the reform of insurance regulation. This approach retains state oversight and coordinates it with existing federal regulation of insurance through the functional regulation sections of the Gramm-Leach-Bliley Act (GLBA).