OFC Bill Introduced In Senate

“Regulatory reforms are needed in areas such as agent licensing and speed to market of insurance products,” NAIFA said in a statement. “NAIFA will study this legislation and continue to work with its industry partners as well as state regulators and Congress to ensure a regulatory environment that allows agents and advisors to meet the needs of consumers.”

The bill would create an independent Office of National Insurance within the Treasury Department similar to those now used to regulate national banks and thrifts. Its commissioner would be appointed by the president for a 5-year term subject to Senate confirmation.

It authorizes the chartering of separate life and property-casualty insurers, but creates a holding company that would provide an umbrella for separate life and p-c insurers.

The bill authorizes the chartering and licensing of national insurance agencies and the licensing of federal insurance producers.

Under the bill, a national agency would be authorized to sell insurance for any federally chartered or state-licensed insurer. A federally licensed insurance producer could sell insurance in any state on behalf of any national insurer or state insurer.

The bill also allows a state licensed insurance producer to sell insurance on behalf of any insurer, including national insurers, operating within the state in which the producer holds a license.

The bill excludes any reference to health insurance, but allows federally licensed insurance producers to sell health insurance offered by state health insurers.

The bill also specifically directs the commissioner to establish regulations barring unfair trade and claims practices.

But, addressing the concerns of insurers, especially the life insurance agents industry, about certain bills currently being proposed in the House and Senate, it exempts all federally chartered insurers/agencies and federally licensed producers from Federal Trade Commission oversight of their antitrust and unfair trade practices authority.

One lawyer and lobbyist said the bill’s introduction “continues the momentum toward enactment of meaningful insurance regulatory reform.” But, the lawyer cautioned, “it promises to be a long process, and the legislation ultimately enacted into law will no doubt change considerably from the current proposal.”

The following groups have expressed support for the National Insurance Act: the Agents for Change, the American Bankers Association, the American Bankers Insurance Association, the American Council of Life Insurers, the American Insurance Association, the Council of Insurance Agents and Brokers, the Financial Services Forum, the Financial Services Roundtable, the Life Insurers Council, the National Association of Independent Life Brokerage Agencies, and the Reinsurance Association of America.