The standard of care insurance agents would have to meet when selling investment products remained to be decided as a conference panel began meeting last week to try to reconcile differing House and Senate versions of financial services reform legislation.

The so-called fiduciary issue is a critical one for insurance agents, as they seek to retain the current suitability standard while the Securities and Exchange Commission continues to study the issue.

Other issues remaining before the conference panel included the powers of a federal insurance office.

The panel began its work last week on the bill, H.R. 4173. The plan was to complete its work in time for the full House and Senate to vote on the bill by July 2.

Final action on creating a federal insurance office within Treasury was delayed over a dispute between the House and Senate on the scope of the authority the office would have to preempt state insurance laws in negotiating bilateral trade pacts.

The conference panel did agree to empower the new agency to study whether and in what ways the federal government should regulate insurance.

It also decided that the Department of Health and Human Services would work with the insurance office in studying long term care issues, except those dealing with an annuity or life insurance component.

Sen. Tom Harkin, D-Iowa, also was reported to renew his efforts to add a provision to the bill barring the SEC from regulating equity indexed annuities.

The Senate bill calls for the SEC to study the issue and to propose to Congress what should be done to address regulatory gaps and overlaps in existing rules.

The base text on the fiduciary standard is the Senate version of the legislation, which supports the industry provision calling for an SEC study of the issue.

But both the Obama administration and Mary Schapiro, chairman of the SEC, support the fiduciary standard.

“The key thing from our perspective is that if Congress wants us to study the issue again, that’s fine. But at the end of that study we need the authority to go ahead and take action,” Schapiro says. “[The legislation] doesn’t give us that authority. That’s the real flaw from our perspective. There is not a grant of authority when the study is done to go beyond our existing authority in respect to rule writing.