A federal commission has recommended that Congress consider eliminating insurers’ limited antitrust exemption, saying recent trends point to the benefit of ending such arrangements.
The recommendation was contained in the report of the Antitrust Modernization Commission. Four of the 12 members of the commission specifically called for repeal of the McCarran-Ferguson Act and 3 other antitrust exemptions, including the Shipping Act, the Export Trading Company Act and the Webb-Pomerene exemption.
One member, John Shenefield, a lawyer at Morgan Lewis Washington who was in charge of antitrust enforcement in the Carter administration, said the repeal of those exemptions “should not be delayed.”
In addition, he said, Congress should create another commission to examine all the other exemptions “now on the books.”
A top life insurance agent trade group official said the report “buttresses our position that the McCarran-Ferguson Act should be retained as is.”
Michael Kerley, senior vice president/federal government relations, for the National Association of Insurance and Financial Advisors, said a detailed reading of the report and an analysis by NAIFA’s lawyers found one of the recommendations “modifies the overall tenor of the report.”
Kerley said the report makes a number of recommendations, one of which is crucial to consideration of the continuation of McCarran-Ferguson: “No statutory change is recommended to the current role of the states in non-merger civil antitrust enforcement.”
“NAIFA thinks this recommendation is critical because the report otherwise fails to differentiate in any way between naked exemptions from the antitrust laws–like the major league baseball exemption, for example–and the McCarran-Ferguson-type exemption which applies only to the extent that the states are actively regulating the insurance-related conduct.”
Kerley said the McCarran-Ferguson Act “does not really function as a true exemption to the federal antitrust laws.”