OCC Opposes Mass. Bank Insurance Law

In its statement, OCC says it based its decision on the substantive effects of a particular state provision on the ability of a national bank to conduct its insurance business.

OCC adds that “none of its conclusions on the Massachusetts law would result in a finding that any provision of the model Unfair Trade Practices Act developed by the National Association of Insurance Commissioners would be preempted.”

Jeff Myers, a representative of the Independent Insurance Agents of America, Alexandria, Va., says IIAA will explore all options to remedy its disagreement with OCC over the Massachusetts law.

He said IIAA strongly disagrees with the OCC’s determination. The provisions at issue, Myers says, are important consumer protection provisions needed to shield consumers from abuses by banks.

This is the second time the OCC has issued a determination preempting a state law regulating bank insurance activities. OCC previously said four provisions of a West Virginia law should be preempted on the same basis, which is that they prevent or significantly interfere with bank insurance activities.

IIAA and the National Association of Professional Insurance Agents, Alexandria, Va., filed a lawsuit against the OCC seeking to overturn the West Virginia determination.