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NCOIL Passes Strong Resolution Opposing Federal Insurance Office Bill

The National Conference of Insurance Legislators (NCOIL) passed a resolution during its annual meeting in New Orleans opposing the Federal Insurance Office Act of 2009...
November 24, 2009

The National Conference of Insurance Legislators (NCOIL) passed a resolution during its annual meeting in New Orleans opposing the Federal Insurance Office Act of 2009 (H.R. 2609). The legislation is scheduled for a mark-up on Tuesday November 24 by the House Financial Services Committee.

NCOIL says the bill moves well beyond the Committee's desire in 2008 - to create an insurance information office for the federal government - to a proposed new federal insurance czar at the U.S. Treasury Department. The resolution states that NCOIL believes that the creation of any such insurance office will inevitably lead to federal insurance chartering. It also expresses strong opposition to the inclusion of "vast new authorities to the FIO that were not debated during previous OII bill drafts."

Rep. Greg Wren (AL), chairman of NCOIL's state-federal relations committee, warned that the national insurance office is "a systematic effort to try to supplant state insurance laws," noting that Congress is "moving with deliberate speed" to vote on financial reform legislation that could be very detrimental to state-based regulation. "Congress and the U.S. Supreme Court have repeatedly affirmed the states' sovereignty over the business of insurance," Wren said. "And yet, Congress seems to be a collision course with, I think, themselves."

The version of H.R. 2609 set to be debated was amended to accommodate some of the changes suggested by the National Association of Insurance Commissioners (NAIC).

NCOIL's new president, Kentucky Rep. Robert Damron, said "I think the current administration and makeup of Congress is much more federally driven at this point in time. They've forgotten states rights, even those who were state legislators at one time." And the NAIC, Damron said, "seems to be wavering a little bit in their support for state-based regulation."