NU Online News Service, Feb. 2, 2004, 6:16 p.m. EST – Insurance commissioners are promoting the value of state insurance regulation this week in Washington.[@@]
The commissioners, who are in the capital for the annual meeting of the National Association of Insurance Commissioners, Kansas City, Mo., face the possibility that Congress could consider legislation this session that would establish some kind of federal insurance regulation.
Lawmakers slated to speak at the NAIC meeting include Rep. Michael Oxley, R-Ohio; Sen. Richard Baker, R-La.; Sen. John Sununu, R-N.H. and Rep. Barney Frank, D-Mass.
In addition to listening, insurance commissioners plan to talk to lawmakers to explain why state regulation is important, according to NAIC President Ernst Csiszar, the South Carolina insurance director.
Csiszar cites the NAIC’s work on an interstate product filing compact as an example of state regulators’ efforts to establish national standards.
Csiszar points to the investigations of the mutual fund industry undertaken by the office of New York Attorney General Eliot Spitzer as another example of the good work that state regulators can do.
Csiszar acknowledges the need for state regulators to move quickly to improve the current regulatory system.
The NAIC has to focus its committee structure and meetings more on speed-to-market and streamlining issues, Csiszar says.
The NAIC will hold fewer meetings at the national level and make more of an effort to keep them open, he says.
But Csiszar warns that adding federal regulation could lead to bureaucracy. Federal regulation also has the potential to turn insurance into a social program and to lead to insurers being asked to cover public costs, he says.
Csiszar says he senses that federal lawmakers do not favor a full-blown “dual charter” regulatory system. Instead, he says, lawmakers might look at creating federal regulatory tools rather than a new federal insurance company charter.
Like Csiszar, Jim Poolman, the NAIC vice president and North Dakota insurance commissioner, points to efforts to create a more uniform product filing system as an example of the good that state regulators are doing.
This year, Poolman says, the NAIC is trying to get all lines of products on the State Electronic Rate and Filing Form system, persuade more companies to use system, and connect the system with a product filing system that California, Florida and Texas are implementing.
Market conduct and producer licensing also will receive regulators’ attention this year, Poolman adds.
States will be encouraged to move toward electronic non-resident and resident licenses and to eliminate paper letters of certificate, Poolman says.