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Consumer Advocates Support State Insurance Regulation

Speaking at the NAIC summer meeting in Seattle, two consumer advocates told insurance commissioners they would prefer to see regulation of insurance remain with the...
August 24, 2010

Speaking at the NAIC summer meeting in Seattle, two consumer advocates told insurance commissioners they would prefer to see regulation of insurance remain with the states, as opposed to a federal takeover. At the NAIC's Regulatory Modernization Task Force, Sonja Larkin-Thorne, an NAIC funded consumer representative, and Amy Bach, executive director of United Policyholders said they support a continuation of state regulation, but would like to see some changes in transparency.

Ms. Larkin-Thorne said the advantage of state regulation is that consumers can have a conversation with regulators directly that would be impossible under a federal system. However, she said regulators need to do more at making policies more transparent and understandable for consumers. Ms. Bach urged the creation of a summary sheet for consumers that would be short and explain what the various parts of the policy mean. Some commissioners questioned the wisdom of such a move, saying it could pose legal problems over what a contract actually said.