The experts are still wading through the thick new draft of the insurance regulatory modernization “road map” bill.[@@]
Rep. Richard Baker, R-La., chairman of the Capital Markets Subcommittee of the U.S. House Financial Services Committee, released the long-awaited discussion draft of the road map Aug. 20. Baker and his staff have been working on the draft for months with House Financial Services Committee Chairman Michael Oxley, R-Ohio.
Lawyers and others continue to analyze the text of what is officially dubbed the State Modernization and Regulatory Transparency Act, but here are a few of the provisions that are starting to attract attention:
- Insurer licensing: The draft version of the road map would let an insurer that was licensed in one state use a uniform application to seek licenses in all other states.
- Producer licensing: It’s common knowledge that the draft calls for uniform licensing standards for agents and brokers and full implementation of the National Producer Licensing database, a project promoted by the National Association of Insurance Commissioners, Kansas City, Mo. A less publicized provision would prevent state insurance regulatory agencies that are unable or unwilling to participate in the database from collecting monies from an increase in fees or creating new fees related to licensing of nonresident insurance producers.
- Interstate life insurance product filing compact: If the road map were enacted and a state joined the compact, the state could disapprove a life insurance product only if the disapproval was clearly stated in writing, was based on specific standards published in a statute, rule or regulation, or was based on an interpretation by a majority of the states.
- Other interstate product filing compacts: The road map would give Congress the authority to authorize the formation of an interstate product filing compact for products other than life insurance and property-casualty insurance. In theory, states could use the provision to form a health insurance product filing compact.
- Viatical settlements: The road map draft says states shall implement the NAIC’s 2001 Viatical Settlements Model Act or laws that address the same issues. If a state does not establish such laws, the NAIC model would be the default law. The draft also calls for the U.S. Securities and Exchange Commission and the North American Securities Administrators Association, Washington, to conduct a study on ways to prevent viatical settlement fraud.