(An Old) Step Toward National Regulation

The sentiment among insurance men, particularly among life insurance companies, in favor of national regulation, has steadily grown within the past few years. The increasing exactions of the States, the unnecessary and expensive examinations, the petty requirements and the many forms of hindrance to the business have served to center the attention of underwriters on the necessity for national regulation. The proposed establishment of a department of commerce at Washington, showing how widespread was public sentiment in favor of the national oversight of corporations, afforded an opportunity for those who were looking for just such an occasion.

Curiously enough, the first attempt to establish a bureau of insurance in connection with the department of commerce failed. For some singular reason the sentiment in favor of national oversight of corporations did not extend to insurance companies, although the business of these companies is more national in character than that of any other enterprise. But insurance has proved a fruitful source of grafting for state politicians, and by resurrecting the ghost of the Paul vs. Virginia case, the enemies of national insurance regulation induced Congress to throw out the provision for a bureau of insurance?.

Can Insurance Be Called Commerce?

An interesting question arises in connection with the whole matter. A quarter of a century ago, in the case of Paul vs. Virginia,* the Supreme Court of the United States declared that insurance was not commerce, and many important state decisions have hinged upon this principle?.

* The Supreme Court overturned Paul vs. Virginia in 1944.