Insurance agents would be represented on a commission to study the potential need for a federal role supporting life insurance in the event of a major terrorist attack under legislation approved last week by the House Financial Services Committee.
The legislation, H.R. 3210, which focuses on establishing a federal backstop for losses incurred by property-casualty insurers due to acts of terrorism, also includes a provision to establish a five-member panel to study whether life insurers may also need federal assistance.
The Committee approved the legislation last week by voice vote.
Under H.R. 3210, which is called the Terrorism Risk Protection Act, members of the panel would include representatives of a federal agency designated by the president, the National Association of Insurance Commissioners, a life insurance company association, a life insurance agent association, and the reinsurance industry.
Once created, the panel would have three months to study the issue and present a report.
H.R. 3210 is sponsored by House Financial Services Committee Chairman Mike Oxley, R-Ohio, and Rep. Richard Baker, R-La.
David Winston, vice president of government affairs for the National Association of Insurance and Financial Advisors, Falls Church, Va., praises the sponsors for including an agent representative on the panel.
In a letter to Rep. Oxley, Winston says that insurance agents are playing an important role in the recovery process following the Sept. 11 terrorist attacks.
NAIFAs perspective, he says, will be very useful to the commission as it studies the potential effects of terrorism on the life insurance industry.
Jack Dolan, a representative of the American Council of Life Insurers, Washington, says that ACLI is very pleased that the Committees proposed study tracks closely the concepts outlined by the Council.
However, Dolan says, ACLI is very surprised that its suggestions for membership on the commission were altered.
ACLI, which first suggested a study, proposed a nine-member commission, including representatives of the federal government, NAIC, the primary insurance industry and the reinsurance industry.
However, ACLI did not include an agent representative in its original proposal.
Similar legislation is expected to be considered by the Senate, but few details about the Senate bill have been released.
It is not clear, at press time, whether the Senate bill will include a life insurance study commission and if so, what the membership will be.
It is also possible that more than one bill could be introduced in the Senate.