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NCOIL Reiterates Opposition to ONI, Compliments Merkley Amendment

The National Conference of Insurance Legislators (NCOIL) has reiterated its opposition to legislation creating an Office of National Insurance, while saying it appreciates an amendment...
May 12, 2010

The National Conference of Insurance Legislators (NCOIL) has reiterated its opposition to legislation creating an Office of National Insurance, while saying it appreciates an amendment offered by Sen. Jeff Merkley (D-Ore.) that would make it "less onerous."

NCOIL sent a letter May 10 to Sen. Merkley stating that "while NCOIL cannot support the concept of an Office of National Insurance (ONI) and feels it is unnecessary, we applaud your efforts to preserve successful state oversight and limit federal powers to negotiate international agreements."

"By confining ONI scope to 'covered agreements' rather than 'international insurance agreements on prudential measures' and providing criteria for action, NCOIL believes you have narrowed the broadly drawn authority of the current Senate proposal and weakened the opportunity for feared 'mission creep.' In doing this, you have made what NCOIL has always considered an onerous proposal less onerous," the letter states.

Previously, NCOIL addressed the bill's charge that the ONI evaluate and recommend to Congress the best ways to modernize the insurance system. "Spurred by optional federal charter (OFC) advocates, such a report might recommend that the ONI manage federal insurance chartering. This sort of study should be done on an objective basis with input from all related state officials." The Merkley amendment changes the charge for a study from the ONI to the Government Accountability Office (GAO).

The National Association of Mutual Insurance Companies (NAMIC) has also come out in support of the amendment, saying it believes "that any federal legislation must recognize the strength and primacy of the state-based regulatory system for insurance and that any pre-emption of state authority should be narrowly limited in scope, and for that reason we support Sen. Merkley's carefully written amendment. The amendment would ensure that pre-emption occurs only when absolutely necessary, while still allowing domestic insurers to remain competitive on a global scale."

Groups opposing the amendment include the American Insurance Association (AIA); the Financial Services Roundtable; the Council of Insurance Agents & Brokers; the Association of Bermuda Insurers & Reinsurers; the American Bankers Insurance Association; the Risk and Insurance Management Society (RIMS); the American Council of Life Insurers (ACLI); and the Reinsurance Association of America (RAA).

NCOIL Letter (5/10/10)


Maine Regulators Blast ONI Proposal (Maine Public Radio 4/12/10)