Optional federal chartering of insurance companies is a long-term process that likely will take several years to accomplish, several members of Congress agreed yesterday.
At the first of a series of hearings on state insurance regulation and OFC, members of a House Financial Services Subcommittee cited numerous shortcomings in the current state regulatory system, but acknowledged that it will take a long time to develop a consensus on any federal action.
Rep. Richard H. Baker, R-La., who chairs the Subcommittee on Capital Markets, Insurance and Government Sponsored Enterprises, said his subcommittee had no specific legislative purpose in mind in beginning the hearings.
However, he said, it is evident that some regulatory reform is in order. The hearings represent the first step, Baker said. He hopes that the Subcommittee can put together some legislative recommendations before the end of the 107th Congress.
Baker noted that legislation is a long-term process, but he questioned how long Congress should wait before trying to act.
Witnesses representing the Downers Grove, Ill.-based Alliance of American Insurers and the Indianapolis-based National Association of Mutual Insurance Companies, urged Baker to judge state regulatory reform efforts by the amount of substantive progress, rather than according to a timetable.