NAIFA Commends Senate for Taking Up Insurance Regulation
April 6, 2006 – The National Association of Insurance and Financial Advisors (NAIFA) today commended members of the U.S. Senate Committee on Banking, Housing and Urban Affairs for addressing the need for insurance regulatory reform.
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Yesterday afternoon Sens. John Sununu (R-N.H.) and Tim Johnson (D-S.D.) introduced the National Insurance Act of 2006. The legislation would allow life and property/casualty insurers and their agents to choose to be regulated by the federal government or remain in the state system—a concept known as “optional federal charter.” The committee also plans to hold hearings to take up the issue of insurance regulation and the need for reforms in the state-based regulatory system.
“The regulation of insurance is an important matter to consumers as well as producers, and deserves the attention it has received by Congress,” said David F. Woods, CLU, ChFC, LUTCF, NAIFA’s chief executive officer. The U.S. House of Representatives’ Financial Services Committee has examined the issue by holding nearly 15 hearings on the problems associated with the current state-based insurance regulatory system and ways it can be improved. This action by the Banking Committee marks the first time the Senate has taken on the issue of insurance regulatory reform.
“For years NAIFA has worked tirelessly with states and the National Association of Insurance Commissioners to modernize state laws so consumers can gain access to the latest products in the marketplace, and agents can best serve their clients,” added Mr. Woods. “NAIFA will continue its work to improve the state-based regulatory system but remains open to good-faith reform initiatives, state or federal, that will help agents better serve the public.”
David E. Smithkey, CLU, RFC, NAIFA’s president, said NAIFA staff and volunteers will study the bill introduced by Senators Sununu and Johnson to see if it meets the specific conditions under which NAIFA will support reform. “Any reform,” he explained, “must streamline the producer licensing process and maintain consumer protections. NAIFA reserves further comment on the bill until that review is complete.”
The Banking Committee is expected to hold hearings as early as this spring. “NAIFA looks forward to working with Banking Committee Chairman Richard Shelby, Ranking Member Paul Sarbanes, Senators Sununu and Johnson, and the other members of the committee to ensure that any insurance regulatory reform proposal that moves forward is consistent with NAIFA’s goals,” said Mr. Smithkey.
About NAIFA: Founded in 1890 as the National Association of Life Underwriters, the National Association of Insurance and Financial Advisors comprises 800 state and local associations representing the business interests of 225,000 members and their employees nationwide. Members focus their practices on one or more of the following: life insurance and annuities, health insurance and employee benefits, multiline, and financial advising and investments. NAIFA's mission is to advocate for a positive legislative and regulatory environment, enhance business and professional skills, and promote the ethical conduct of its members. NAIFA's website can be accessed at www.naifa.org.