Finally, the moves of non-insurance regulators into the business of state insurance regulation will get a going over. In the process, so too will the status of insurance regulation–who’s doing it and where it is going (whether the optional federal charter becomes reality or not).
Here is what is happening: The National Conference of Insurance Legislators, Troy, N.Y., says its research arm, the Insurance Legislators Foundation, is conducting a study on state insurance authority.
It will be an “in-depth objective look at state insurance regulation in its current form,” says NCOIL. The researchers are Lord, Bissell & Brook; Navigant Consulting Inc.; and Political Science Prof. Joseph Zimmerman from The Rockefeller College of Public Affairs and Policy at the State University of New York, Albany. The preliminary review is slated for NCOIL’s summer meeting on July 21, 2007.
Some readers might give a ho-hum to that piece of news. After all, studies are a dime a dozen these days, right?
However, this particular study may well be worth more than a dime. That’s because it will not only examine the components of state regulation and where such regulation works and does not work; it will also probe into some areas about which individual firms, advisors and regulators do not want to talk publicly, but about which they deeply want investigation and scrutiny.
That area has to do with what Michigan Sen. Alan Sanborn, NCOIL’s current president, calls the “ever increasing blurring of the lines of responsibility with regard to state insurance regulation.”
As a result of this blurring, he says, NCOIL feels it is necessary to examine objectively the role played by “legislators, regulators, state attorneys general, the courts, the National Association of Insurance Commissioners, as well as additional governmental and other entities” in the regulation of insurance.
Depending on how deep the analysis goes, it may mark the beginning of a serious state-side effort to clarify just who regulates what. Where products are concerned, it may also help straighten out which body should be heeded when designing, marketing and distributing insurance products.
This effort is coming none too soon.