WASHINGTON BUREAU — A bill that would create an Office of Insurance Information within the Treasury Department was introduced Friday by Rep. Paul Kanjorski.
H.R. 2609, the Insurance Information Act of 2009, uses language from the OII bill that Kanjorski, D-Pa., introduced in 2008. The earlier OII bill died on the House floor in September 2008.
Kanjorski, D-Pa., is chairman of the House Financial Services Capital Markets, Insurance, and Government Sponsored Enterprises Subcommittee.
Six members of the House Financial Services Committee, including Rep. Judy Biggert, R-Ill., the highest-ranking Republican member of the House Financial Services Subcommittee on Oversight and Investigations, have joined as original cosponsors of the new OII bill.
As proposed in H.R. 2609, the OII would collect and analyze data on insurance; advise the Treasury secretary on major domestic and international policy issues; report to Congress every two years; establish federal policy on international insurance matters; and ensure that state insurance laws remain consistent with federal policy in coordinating international trade agreements.
The bill would also establish an advisory group to help inform and advise the head of the insurance information office. Members of the advisory group would include state regulators, consumer groups and other parties in the insurance industry.
The OII would help Congress and the federal government make better decisions regarding national and international insurance policy, Kanjorski says.
“While most other pieces of the national economy have some sort of knowledge center within the federal government, insurance currently stands without a central office,” Kanjorski says in a statement.
Biggert says she is joining as lead cosponsor because an OII would help “to guide and inform federal policymakers on insurance matters while preserving sound regulatory practices and consumer protections that are currently working well at the state level, as in Illinois.”
The new OII bill is being introduced as the Obama administration prepares to propose changes in the overall financial regulatory system.
In testimony before a House Appropriations Committee subcommittee Thursday, Treasury Secretary Timothy Geithner said a broad set of regulatory change proposals should soon be ready to be unveiled. A proposal for creating a new financial protection consumer products entity could be part of the package.
A spokesman for the Treasury Department said the administration has not yet determined whether insurance products will be among the products that would come under the umbrella of the new consumer protection entity.
The insurance industry was caught off guard by the introduction of H.R. 2609. The House recessed Thursday, when four other insurance bills were introduced, and Kanjorski did not immediately put out a press release disclosing the introduction of the new bill.
A spokesman for Rep. Barney Frank, D-Mass., chairman of the House Financial Services Committee, says the chairman did not know the bill was being reintroduced.
Only when a press release lauding the bill was released by the American Council of Life Insurers, Washington, did the bill introduction become public knowledge.
In the release, ACLI President Frank Keating says, “Rep. Kanjorski has spoken forcefully about the urgent need for the federal government to develop the expertise and capacity to monitor insurance markets and thus advance the goal of protecting the American economy from threats to the financial system.”
“Life insurance is a $5 trillion industry and affects the lives of more than 75 million American families,” Keating says. “Reform of financial services regulation in the U.S. will be incomplete if the life insurance industry is ignored.”
H.R. 2609 is based on a recommendation contained in a Blueprint on Financial Modernization prepared by the Treasury Department under the guidance of then-Treasury Secretary Henry Paulson. The blueprint was released in March 2008.
The 2008 OII bill sailed through the House Financial Services Committee, and then was placed on the suspension calendar – a mechanism the House uses to expedite passage of measures that have broad, bipartisan support. House leaders scheduled the measure to come up for action in September 2008.
At that point, the old OII bill stalled. It was tabled on orders from House Speaker Nancy Pelosi, D-Calif., at the suggestion of Rep. Jackie Speier, D-Calif. Speier requested that the bill be pulled out of fear that it would pre-empt Proposition 103 and other California initiatives that impose tight control on insurance rates and rules.
Consumer Watchdog, Santa Monica, Calif., a group whose founder, Harvey Rosenthal, spearheaded the campaign that led to voter approval of Prop. 103, is supporting Speier’s efforts to oppose any federal government involvement in insurance regulation.
At the same time that the OII bill died, the House passed a bill that would have created the National Association of Registered Agents and Brokers. The NARAB bill died without Senate action in the last Congress. A similar NARAB bill was introduced in the House Thursday.