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New Makeup of Congress to Affect Insurance Issues

The National Association of Professional Insurance Agents congratulates the winners in the midterm elections and looks forward to Congress making progress in dealing with important insurance issues...
November 13, 2014

 

The National Association of Professional Insurance Agents (PIA) congratulates the winners in the midterm elections and looks forward to Congress making progress in dealing with important insurance issues.

"The voters have spoken and as a result, new opportunities may open up for legislative action that will have an impact on insurance issues," said PIA National Executive Vice President & CEO Mike Becker. "PIA encourages the House GOP leadership to schedule action on a long-term extension of the Terrorism Risk Insurance Act (TRIA) during the upcoming lame-duck session. Also awaiting passage is the National Association of Registered Agents and Brokers (NARAB II)."

"In addition, we look forward to Congress passing the Insurance Capital Standards Clarification Act (S.2270) by Sen. Susan Collins (R-Maine), which would clarify that the Federal Reserve should regulate insurance companies differently than banks," Becker said. PIA supports the so-called Collins Amendment fix as a common-sense solution and will continue to work with Congress to urge its enactment during the lame-duck session.

"The GOP takeover in the Senate will result in a shift of legislative priorities," said PIA National Director of Federal Affairs Jon Gentile. "Issues that may now move to the forefront include efforts to repeal or significantly alter the Affordable Care Act (ACA), changing aspects of the Dodd-Frank Act and the potential for tax reform. Such initiatives, however, face the realistic prospect of vetoes by President Obama."

The lame-duck session is scheduled to begin on Nov. 12 and will likely last through Dec. 12. The insurance industry provisions are likely to be included in the Continuing Resolution (CR) Congress must pass to keep the government funded until March 15.

Impact at State Level Less Clear

The possible impact of the Republican wave of victories on insurance regulation at the state level is less clear at this point. The makeup of the National Association of Insurance Commissioners (NAIC) could be affected by changes in governorships. Several states where the governor appoints the insurance commissioner saw GOP challengers defeat Democratic incumbents, including Maryland, Arkansas and Illinois.

Democrats did pick up the governor's office in Pennsylvania, with Tom Wolf's win over incumbent Gov. Tom Corbett. That has the potential of ending Michael Consedine's tenure as Pennsylvania Insurance Commissioner; however, observers note that Consedine has a high profile on international regulatory issues and is in line to become NAIC president.

Connecticut's Democratic Gov. Dannel Malloy turned back a strong GOP challenge, thus solidifying the position of Insurance Commissioner Thomas Leonardi. Leonardi has been active at the NAIC on international matters and, like Consedine, he has been an outspoken supporter of state regulation of insurance.

Observers say it is possible that the new Republican majority will attempt to restrict the Federal Insurance Office (FIO). Industry representatives say lawmakers may push back against the FIO's authority to preempt a state insurance law if it feels the law creates "less favorable treatment" for a non-U.S. insurer subject to a covered agreement than a U.S. insurer.

A repeal of the Affordable Care Act (ACA) is not going to happen. When close races and runoffs are decided, the most votes the Republicans will have in the Senate is 54, versus 46 for the Democrats. Because of Senate rules, 60 votes will still be required to pass legislation, or get it to the Senate floor. If a repeal were to pass, President Obama would veto it. As for tweaks to Obamacare, six Democrats would have to vote with Republicans for any changes to pass, which would then be subject to a presidential veto. From a practical standpoint, by the time the new senators take office there may be 13 million Americans covered under the ACA. Taking away benefits that already exist is politically a non-starter.

GOP Control May Help Industry Aims (Insurance News Network 11/5/14)
Senate Sweep Won't Make ACA Changes Easy (Insurance Broadcasting 11/5/14)

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