State regulators and state lawmakers are attacking a bill that could force state insurance departments to compete with a new federal agency for the opportunity to regulate insurance companies and insurance producers.
U.S. Sens. John Sununu, R-N.H., and Tim Johnson, D-S.D., unveiled the bill today in Washington.
Alessandro Iuppa, Maine superintendent and president of the National Association of Insurance Commissioners, Kansas City, Mo., says he believes passing the bill would reduce consumers ability to resolve complaints.
Dealing with a federal agency is “never easy, at best,” Iuppa says. “I’m not confident that the citizens of Maine would get the same response in Washington.”
Iuppa says regulators at the Maine Bureau of Insurance have had a tough time helping Maine residents with complaints involving the Employee Retirement Income Security Act, the new Medicare Part D prescription drug plan, and other laws and programs set up in such a way that the federal government has preempted state authority.
“The ability to help is limited by limited authority,” Iuppa says.
Implementation of the Part D drug plan has been particularly disastrous, Iuppa adds.
Creating a federal insurance regulator also could lead to many conflicts between the state and federal systems, Iuppa says.
Iuppa wonders what would happen to solvency supervision if federally chartered insurers participated in state guaranty systems.