The McCarran-Ferguson Act, passed in 1945, offers a number of benefits to the insurance industry that it would otherwise not possess due to federal antitrust oversight. Among these are:
Exemption from the Sherman, Clayton, and Federal Trade Commission Acts (joint rate-making among property/casualty insurers is one of the activities thus allowed).
Exemption from the “state action doctrine,” which allows for anticompetitive conduct as long as that conduct is part of a state policy and is regulated by a state.
Exemption from the Noerr-Pennington Doctrine, which provides immunity for some joint efforts by competitors to petition the government.
This has led to allegations that, without the protection provided by McCarran-Ferguson to the industry, the activity of joint rate-making by property/casualty insurers might constitute a violation of federal antitrust laws, allowing as it does the aggregation of large amounts of data in order to allow insurers to project losses into the future and thus protect themselves from those losses to the extent required to continue doing business. Such aggregation of data allows for the possibility of rate fixing, but also allows the industry to function without so much risk to social cost (caused by an insurer becoming insolvent and thus unable to pay claims).