WASHINGTON–A top property-casualty insurance agents' trade groupis criticizing a decision by a large industry organizationrepresenting life insurance agents to recommend qualified supportfor legislation creating an optional federal charter for lifeinsurers.

The verbal shot directed at the board of trustees of theNational Association of Insurance and Financial Advisors (NAIFA)came today from Charles Symington, senior vice president,government affairs for the Independent Insurance Agents and Brokersof America.

“The NAIFA decision to move from neutrality to conditionalsupport of optional federal regulation doesn't come as a surpriseto many in Washington D.C.; however, it is likely to be questionedby many life agents, particularly those agents who represent morethan one insurance company,” said Mr. Symington.

He was commenting on the Friday NAIFA board decision torecommend that its members support an OFC. Many of those memberscross-sell and offer property-casualty as well as life coverage.NAIFA is now the fourth largest life group to endorse OFC.

The IIABA and NAIFA have been working together on legislationthat would recreate the National Association of Registered Agentsand Brokers.

The legislation introduced last month–H.R. 5611, the NARABReform Act of 2008–would create a national agent license. Itsprovisions would create a streamlined nonresident licensing foragents.

Jeffrey Taggart, president of NAIFA, confirmed that between 30percent and 40 percent of NAIFA members either sellproperty-casualty insurance as general agents or are employees ofgeneral agencies or captive agencies which also sell p-cproducts–for example, State Farm and Nationwide.

But he did point to the NAIFA letter to its members suggestingthey support an OFC.

He added that the policy would be presented to the members ofNAIFA at the trade group's annual meeting in September in SanDiego.

He said all constituent groups of NAIFA, including state andlocal associations, are being consulted on this issue.

Mr. Taggart noted that the letter said NAIFA would continue tosupport the legislation creating NARAB-II, the shorthand term forH.R. 5611.

The letter explained that the Policy Formation Subcommittee ofthe NAIFA Trustees had recommended that the organization “continueto support the principles underlying state regulation of thebusiness of insurance and efforts to improve the state-based systemof insurance regulation, and amend the current NAIFA policy oninsurance regulatory reform to include support of the OFC conceptprovided that several conditions are met.”

Specifically, the trustees said in the letter, thequalifications are that, “should the National Insurance Act becomelaw, we want our members to have the option to remain licensed andregulated at the state level.”

“We believe any modernization proposals should promote consumerprotection, streamline agent licensing, improve product speed tomarket, and improve the competitiveness of the insurance industry,”the board added.

The qualification the trustees added is that NAIFA will work toensure any final legislation include a provision giving its membersthe option to remain licensed and regulated at the state level,according to a letter to its leadership that the trustees releasedtoday.

The trustees acted after being given assurances byrepresentatives of several large insurance companies in meetingsthat if a major life insurer elects to become federally chartered,it will not insist that all of its agents and brokers also becomefederally chartered, according to an official of a life insurancecompany involved in the talks who asked not to be named.

The NAIFA decision means that all major life insurance industrytrade groups are backing such legislation. Specifically, theseinclude the American Council of Life Insurers, the Association forAdvanced Life Underwriting and National Association of IndependentLife Brokerage Agents.