A new association says it is speaking for insurance agents who want to give insurers a chance to choose between state regulation and federal regulation.[@@]
The group, Agents for Change, has been operating for 2 months and now has about 200 members, organizers say. The group was put together by Bonner and Associates, Washington, a lobbying firm, with seed funding from the Financial Services Roundtable, Washington. The Financial Services Roundtable, a coalition of financial services companies, continues to fund the group.
“What we’re all about is the optional federal charter and trying to make that happen,” says Robert Poli, a Rockville, Md., agent who serves as chairman of Agents for Change.
Under the Gramm-Leach-Bliley Financial Services Modernization Act, “by 2002, the insurance commissioners had to come up with something to make it easier for us to do business across state lines.”
Commissioners have not made life easier for agents to do business across state lines, and that shows that insurers need to have the option of choosing between a state charter and a federal charter, Poli says.
Poli says he believes efforts to create an optional federal charter are losing out to efforts to support the State Modernization and Regulatory Transparency Act. House Financial Services Committee Chairman Michael Oxley, R-Ohio, and Rep. Richard Baker, R-La., who chairs a key Financial Services subcommittee, have proposed the SMART Act.
Persuading members of Congress to support an optional federal charter system “is an uphill battle,” Poli says. “They’re looking for a very quick, neat and tidy answer.”
Agents for Change recently held a gathering in Washington that gave agents a chance to meet 20 senators and representatives who, Poli says, were, “very sympathetic to our cause.”
The biggest agent group, the Independent Insurance Agents and Brokers of America, Washington, is opposing the optional federal charter proposal, supporting the SMART Act and questioning Financial Services Roundtable support for Agents for Change.
“The Big I finds it interesting that the Financial Services Roundtable, which represents only the largest Financial Services companies, is behind this so-called Agents for Change,” says Charles Symington, IIABA’s senior vice president of government affairs and federal relations.
IIABA says it recently drew 1,000 agents to Washington to lobby for the SMART Act.
Poli acknowledges that not all agents share his views about an optional federal charter. “We talked to some agents who feel the state insurance commissioners are doing a good job, and I believe they are doing a good job,” he says, emphasizing the optional aspect of the proposed federal charter. However, he says, the variances in licensing regulations can cause significant problems for agents. As an example, he says, if a customer moves to a different state, that agent faces the decision of getting licensed in the new state or, if those licensing regulations are too burdensome, severing the relationship.