WASHINGTON BUREAU — A House committee has voted to approve a Consumer Financial Protection Agency bill and to exempt insurance companies and products from CFPA oversight.
Members of the House Financial Services Committee today voted 39-29 to approve H.R. 3126, a bill introduced by House Financial Services Committee Chairman Barney Frank, D-Mass., that would create the CFPA.
Members agreed Wednesday by a voice vote to add the insurance exemption amendment, which was offered by Rep. Gwen Moore, D-Wis., and Rep. Erik Paulsen, R-Minn.
When the Obama administration proposed creation of the CFPA in August, it recommended that the CFPA have the ability to regulate some insurance products typically sold in connection with banking services, such as credit life insurance. Frank’s original H.R. 3126 draft also would have given the CFPA the authority to regulate credit insurance, title insurance and mortgage insurance products.
Moore and Paulsen introduced the insurance exemption amendment at the request of the Credit Union National Association Mutual Insurance Society, Madison, Wis., which is based in Moore’s district.
The approved amendment, which has several titles, declares that the “term ‘financial activity’ shall not include the business of insurance,” and includes reinsurance in the definition of the business of insurance.
The amendment also includes language barring the CFPA from interfering with state insurance regulators’ oversight of insurance companies and products.
The original version of the Moore insurance exemption amendment would have totally exempted credit insurance, title insurance and mortgage insurance products from CFPA oversight.