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Regulation and Compliance > State Regulation

Last Laugh

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I’m sure I’m not the only person to see the unconscious irony in the hissy fit that Walter Bell, outgoing president of the National Association of Insurnace Commissioners, had over regulators not being asked for their input in the first round of work on a study being sponsored by the Insurance Legislators Foundation. But when it comes to irony (unconscious or otherwise), you can’t be sure.

The ILF is associated with the National Conference of Insurance Legislators, which for a while now has had a running and escalating beef with the NAIC over the issue of NAIC meetings that are closed to legislators, consumer representatives and the press.

NAIC has been fairly unbending in its insistence that it has the right to hold meetings that are closed to all but state regulators.

This issue has become a rallying cry for the gentleman who is now the president of NCOIL, Rhode Island state Rep. Brian Kennedy.

Kennedy, who is something of a firebrand (and I say that admiringly), has undoubtedly tapped into a large pool of resentment that has built up over the years among state insurance legislators over what they perceive as the NAIC’s high-handed treatment of them.

These legislators feel, after all, that they are elected representatives of the people of their states who make the laws governing those insurance departments and commissioners that make up the membership of the NAIC.

The gushing out of this feeling of being galled by the NAIC’s treatment–and the rhetoric that has accompanied the gush–has made for some very interesting exchanges over the last year or so.

It rose to a fevered pitch when some state legislators (Kennedy among them, if I remember correctly) were barred by security forces from entering a closed session at a quarterly NAIC meeting. Since then there have been some nice-nice gestures, but the underlying situation seems to have changed but little.

There’s an old saying that “what goes around comes around.” But as Claude Rains would say, I’d be “shocked, shocked” if that had anything to do with the NAIC’s input not being sought for a study that has some unflattering things to say about the organization and which has recommendations that attempt to address the failings that state legislators see in its current hegemony.

Thus do I appreciate the irony in remarks by Bell such as his caution that regulators and legislators are “both in this together.” The “this” that he refers to, of course, is the effort to preserve state regulation. It’s a line that state legislators have used in the past as an exhortation for unity across the regulator-legislator spectrum. It has not gotten a noticeable response from the NAIC, which has often seemed to be on its own course regarding state regulation. And that course has at times seemed to be more about the preservation of the NAIC than state regulation.

But it’s Bell’s pique at being excluded that I find so unintentionally hilarious. For an organization that insists on having closed meetings in the face of growing opposition from many quarters to pout that it was not consulted for the study, that some of the report was “undocumented,” and that it used attribution such as “some say,” is pretty funny.

It also takes a lot of gall, but in this case I think NCOIL might have the last laugh.


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