Agents, Brokers May Sue Over ?Do Not Call' Regs

By Steven Brostoff, Washington Editor

NU Online News Service, Aug. 6, 11:35 a.m. EDT,Washington?The Independent Insurance Agents and Brokers ofAmerica may go to court to try and overturn new FederalCommunications Commission regulations subjecting the insuranceindustry to "do not call" telemarketing requirements.

"We are fully prepared to file a lawsuit if necessary," saidMaria Berthoud, senior vice president of federal affairs for theAlexandria, Va.-based IIABA.

Currently, she said, IIABA is looking at the possibility of alegislative solution. Agents are forming a coalition with realtorsand other professionals who are affected by the FCC's "do not call"regulation, Ms. Berthoud said.

In addition, she said, IIABA is launching a grassroots effort,asking agents to contact their members of Congress to express theiropposition to the regulation.

Ms. Berthoud noted that in addition to a requirement that agentsand others affected by the new regulation check a "do not call"list before contacting a prospect with whom there is no priorbusiness relationship, the FCC also establishes a "do not fax"requirement.

The "do not fax" provision, she said, is at least as importantto agents as the "do not call" provision.

The FCC's "do not call" regulation was issued on July 25, 2003,and applies to those industries, including insurance, that areexempt from a similar "do not call" regulation promulgated earlierthis year by the Federal Trade Commission.

But the FCC's regulation goes beyond that of the FTC, in that itapplies to all calls, both local and interstate. The FTC'sregulation applies only to interstate calls.

In addition, the FCC declined to include a "de minimis"exemption for small businesses that make a limited number ofcalls.

FCC said in the regulation that it does not believe the costs ofchecking a national database will be unreasonable for a smallbusiness.

As for the insurance industry specifically, the FCC rejectedformal comments filed by the Washington-based American Council ofLife Insurers arguing that because the business of insurance isregulated by the states under the McCarran-Ferguson Act theregulation should not apply to the insurance industry.

FCC said the McCarran-Ferguson Act does not operate to exemptinsurance companies wholesale from the "do not call"requirement.

Indeed, FCC said, the legislation that established the "do notcall" requirement, the Telephone Consumer Protection Act, iscompatible with state regulatory interests.

Moreover, FCC said, uniform application of a national "do notcall" registry best serves the goals of the legislation.

"To exempt the insurance industry from liability under TCPAwould likely confuse consumers and interfere with the protectionsprovided by Congress through the TCPA," FCC said.