Life producer groups today had a national stage for discussing whether insurers and agents should get to choose between state regulation and regulation by a new federal agency.
John Felton IV, Chairman of the National Association of Independent Life Brokerage Agencies, Fairfax, Va., testified before a hearing of the capital markets subcommittee of the House Financial Services Committee that NAILBA believes an “optional federal charter” approach would give consumers quicker access to a wider variety of products that would better meet their needs.
“The reduction of costs associated with working with one regulator, not 50, would be reflected in the pricing of products,” Felton testified, according to a written version of his remarks.
“This would have the effect of reducing costs to the consumer, providing consistent agent licensing standards and continuing education requirements,” Felton said.
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In addition, centralized control of agent status through a national database would give consumers a higher level of confidence in insurance industry representatives, Felton said.
Establishing federal regulation of insurance also would help give the insurance equal standing with other financial services industries, Felton testified.
The National Association Insurance and Financial Advisors, Arlington, Va., which did not get to send a witness to the hearing, released a statement of its own saying that NAIFA embraces federal initiatives to improve the regulation of insurance.
NAIFA remains “open to considering any and all regulatory options that will allow our members to better serve their clients,” NAIFA President Jeffrey Taggart says in the statement.
“Simply put, NAIFA favors reform, improvement and progress over the status quo,” Taggart says.