ACLI Rebuts Pickens On His Fanciful Picture Of Progress
To the Editor: Your provocative editorial, “He May Be My Brother, But He Is Getting Heavy,” Nov. 17, and related letter, “Pickens Reflects on the Call by Some for Federal Regulation,” Nov. 3, by National Association of Insurance Commissioners President and Arkansas Insurance Commissioner Mike Pickens represent extremes in logic and accuracy on the issue of regulatory modernization.
You are right in pointing out that life insurers need to establish themselves as more than a branch of a massive “insurance industry.” That effort is well under way. We expect that in time the distinctions between life insurance and other insurance lines will be as clear to others as it is to us.
On the other hand, Commissioner Pickens offered the Underwriter reflections that were both surprising and deeply disappointing: surprising because he failed to demonstrate even a basic appreciation of the factors motivating a large and increasingly impatient segment of the insurance industry to seek a federal regulatory option, and disappointing in that he painted what can only be characterized as a fanciful picture of the progress states are making in their efforts to modernize the present regulatory environment.
Lets look at several of his reflections and then consider the facts.
Reflection: A relatively small segment of the insurance industry is calling for a federal regulator.
Fact: Almost all life insurers, a significant segment of the property/casualty industry, a growing universe of insurance agents and even a prominent national consumer organization advocate a federal regulator.
Reflection: Insurers want an optional federal charter because banks are competing with them through the sale of insurance products.
Fact: We have no competitive concern with banks selling insurance products. Its good for our business. We are concerned with the speed-to-market implications of banks and securities firms competing with their non-insurance products in the same markets (e.g., retirement security) that we address with life insurance products.
Reflection: The states have made “a great deal of unprecedented progress” on speed-to-market.