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August 31, 2008 at 04:00 PM
The last few weeks, culminating with this week’s Republican convention, have been an exciting period for couch potatoes.
Specifically, there have been the Olympics, as well as the appearance of a severely ailing Sen. Edward Kennedy, D-Mass., and a feisty Sen. Hillary Clinton, D-N.Y., at the Democratic convention.
And Sen. Joseph Lieberman, Ind.-Conn., a “liberal,” is likely to receive a warm reception from a very conservative audience when he addresses the GOP convention.
In the midst of all that glamour and suspense, however, there was a return to reality for the insurance industry in the form of a reminder by National Association of Insurance Commissioners officials during a recent conference call of their “vehement” opposition to an optional federal charter.
The comment was made as NAIC officials negotiate with House Financial Services Committee staffers over language they will accept in legislation that will create an Office of Insurance Information in the Treasury Department.
They seek to limit federal authority of insurance to international trade issues, language that Treasury may find too narrow to accept.
What that final language will be is unclear as this edition of National Underwriter goes to press.
But what is clear is that this month may yield an historic step by Congress to dip the federal government’s toes into insurance regulation. And that step would be at odds with the NAIC’s apparently emerging hard-line position on a federal role on insurance issues.
In other words, it appears that too many rivulets of water whispering federal involvement in insurance regulation are emptying into the same stream, and that stream appears to be going in the opposite direction to where state regulators and legislators seem to be.
To put it into images that official Washington uses, there are many tea leaves pointing to some form of federal involvement in insurance regulation, both domestic and international, sooner rather than later.
The leaves include the fact that the bill, as amended through the talks with the NAIC, will likely move swiftly through the House, perhaps on the suspension calendar, which is reserved for action on bills with broad bipartisan support.
And a surprise leaf was candid comments on the issue by Sen. Chris Dodd, D-Conn., chairman of the Senate Banking Committee, at a hearing July 29 on insurance issues.
Dodd indicated that there is strong interest in such legislation in the Senate, and acknowledged that even considering federal involvement in insurance would have been heresy for someone who in the past has been an unabashed cheerleader for insurance interests in Congress.
