Members of the House today voted unanimously to pass a bill that could change regulation of the surplus lines and reinsurance markets.
Implementation of the bill, H.R. 1065, the Nonadmitted and Reinsurance Reform Act of 2007, could make regulation of the surplus lines and reinsurance markets more uniform from state to state, supporters say.
The American Council of Life Insurers, Washington, is welcoming passage of the bill.
“We applaud Congress for starting to recognize the importance of uniformity in insurance regulation,” ACLI spokesman Jack Dolan says.
In addition to helping to move H.R. 1065 forward, the ACLI would like to support broader legislation that would give insurers the option of choosing to a federal charter, Dolan says.
H.R. 1065 would give the home state regulator of an insurer primary oversight of multi-state surplus lines risk.
Under the bill, the home state regulator also would be responsible for allocating any taxes collected on the coverage to the other involved states. The legislation also would make it easier for sophisticated purchasers to access the surplus lines market.
The primary sponsors of the bill are Reps. Dennis Moore, D-Kansas, and Ginny Brown-Waite, R-Fla. Brown-Waite was the bill’s floor manager.
“Regulatory problems have caused significant disruptions in the marketplace, including increased bureaucratic holdups, paperwork and conflicting tax requirements,” Brown-Waite said during floor debate on the bill, which was passed under expedited rules. “H.R. 1065 makes it clear that the state where the policyholder resides should be the state that is in charge of regulation.”
Sens. Bill Nelson, D-Fla., and Mel Martinez, R-Fla., introduced a similar bill, S. 929, in the Senate in February.