The Association for Advanced Life Underwriting has decided to form its own political action committee, necessitating that AALU become independent of the National Association of Insurance and Financial Advisors, which it has been part of since 1957.
Both AALU and NAIFA acknowledged this could reduce the size of NAIFA’s PAC, which is the largest of all insurance trade groups based in Washington.
The decision to become independent of NAIFA was required by campaign finance laws, officials of AALU and NAIFA said.
Larry Raymond, AALU president, said it was “not our intent to take away from any currently existing PAC, but rather to avail ourselves of another tool to better represent our members.
“We want to strengthen the life insurance agents’ voice in Washington,” he said.
In confirming that independence was required in order to create its own PAC, Marc Cadin, a lobbyist for AALU, said, “NAIFA will continue to have a large and vibrant political action committee.”
Jeffrey Taggart, president of NAIFA, confirmed that election law required the AALU to become independent of NAIFA once AALU decided to create its own PAC.
AALU represents specialized agents who advise and sell high-end insurance policies to businesses and wealthy individuals.
Taggart said AALU will continue to be a conference of NAIFA, but an independent one, like the Million Dollar Round Table, which was formerly a conference of NAIFA but now completely independent.
“To have a PAC, they have to be independent,” Taggart said. However, he added, “Our goal is to make it so we are closer together than further apart.”
Sometimes, he said, AALU has different political objectives than NAIFA, although they share the core principle–”that the thin threads that protect our industry must be preserved.”
The two groups differ on the issue of an optional federal charter, with AALU supporting it, while NAIFA is remaining neutral as it studies the issue, Taggart said. However, this was not an issue which led to the separation, he added.
AALU said its own PAC would “better facilitate its political advocacy on Capitol Hill.”
AALU’s Raymond said that establishing the PAC “and integrating it into AALU’s suite of advocacy tools is the latest in a long line of judgments that have positively impacted AALU’s ability to represent its members.”
He added that creating “our own PAC was part of a planned, evolutionary process.”
Taggart acknowledged that as a result of the decision, NAIFA will no longer be able to solicit members of AALU who are not members of NAIFA–its “solicitable class.” AALU’s PAC can potentially raise up to $5,000 per year from each of its 2,000 members or a potential of $10 million dollars per year.
But, Taggart said the potential funds NAIFA members could contribute under federal election laws are much larger since its membership is around 60,000.
Marc Cadin, an AALU lobbyist, explained it this way. “NAIFA will continue to be important,” he said. “They have a broader set of issues; we focus on the issues of the advanced market.
“It’s a different level of focus and concentration on specific issues. But it is complementary to NAIFA’s job. It always has been and always will be,” Cadin said.
He defended NAIFA as the “grass roots voice for the agents’ community. It has members in every congressional district throughout the country.”
AALU’s members, on the other hand, “are ‘grass tops,’ fewer numbers, higher quality relationships. We focus on the top producers,” Cadin said. “Our membership is the top-producing agents in the industry.”
He explained that AALU has established “a strong group of experienced lobbyists who are well-known to members of Congress.” He cited, Ken Kies, former chief of staff at the Joint Committee on Taxation; Steve Ricchetti, former deputy chief of staff to President Bill Clinton; William Archer, former chairman of the House Ways and Means Committee, as well as 5 in-house lobbyists.