November 5, 2003
States to Congress: Leave Insurance Regulation to Us
WASHINGTON, D.C. - State, rather than federal, reform of the insurance regulation process offers the best hope for a system that meets the needs of consumers and the industry, New York State Senator Kemp Hannon told a congressional panel today.
“For more than 150 years, states have successfully and effectively regulated the insurance industry,” said Senator Hannon, co-chair of NCSL’s Task Force to Streamline and Simplify Insurance Regulation. “Federal intervention at this point would introduce a host of unintended consequences.”
Senator Hannon testified today on behalf of the National Conference of State Legislatures before the U.S. House Financial Services’ Subcommittee on Capital Markets, Insurance and Government Sponsored Enterprises.
At issue is whether the federal government can regulate the insurance industry in a manner that would keep the industry more competitive for consumers.
“Federal legislation in the area of insurance regulation would be a tremendous mistake,” Senator Hannon continued. “It would endanger effective state regulation, threaten the creation of a vast new federal bureaucracy, risk state consumer protections, jeopardize insurer solvency and endanger the strength and stability of the insurance marketplace.”
Since 2001, state legislatures have streamlined and simplified state insurance laws. NCSL has endorsed model legislation to create uniform national standards for life insurance. Additionally, NCSL has endorsed a statement of principles to guide legislative efforts in updating property and casualty insurance rate and form requirements.
State legislatures have also passed laws to provide producer licensing reciprocity and to meet and exceed federal standards for insurance information privacy.
NCSL is a bipartisan organization serving the legislators and legislative staff of the states, commonwealths and territories. Its mission is to improve the quality and effectiveness of state legislatures, foster interstate communication and provide the states a strong, cohesive voice in the federal system.
### |
