Filed Under:Markets, Regulation/Legislation

NARAB II Bill Passes in the House

The House today overwhelmingly passed legislation that would provide a mechanism for establishing true nonresident licensing reciprocity for insurance agents.

The measure was approved by the House by a 397-6 vote. It was reported out by the Senate Banking Committee in June and is now awaiting floor action.

Industry officials privately believe that, despite the current gridlock in Congress, the program, called the National Association of Registered Agents and Brokers, has a very good chance of being enacted by this Congress.

NARAB, as envisioned by the legislation, would create a non-profit, independent board that would allow multistate licensing for insurance producers.

Under HR 1155, the “National Association of Registered Agents and Brokers Reform Act of 2013," insurance agents will be able to apply for NARAB membership and become licensed to sell insurance in multiple states, but states will maintain their full authority in regulating the business of insurance.

States would retain their regulatory jurisdiction over consumer protection, market conduct and unfair trade practices, and would retain their rights over licensing, supervision, disciplining and the setting of licensing fees for insurance producers, according to Ken Crerar, president and CEO of the Council of Insurance Agents and Brokers.

The bill was introduced by House Insurance Subcommittee Chairman Randy Neugebauer, R-Texas, and Rep. David Scott, D-Ga., in March with 42 original cosponsors. The bill currently boasts the support of 86 bipartisan sponsors.

The bill did not need action by a House committee because it has already passed the House in two prior Congresses by voice vote, according to Joel Wood, CIAB senior vice president of government affairs.

The Senate bill is S 534, the National Association of Registered Agents and Brokers Reform Act of 2013. It was introduced in the Senate in March by Sen. John Tester, D-Mont., and Sen. Mike Johanns, R-Neb. It has 24 co-sponsors.

“NARAB II is vitally important for tens of thousands of Big ‘I’ members who operate on a multi-state basis,” said Robert A. Rusbuldt, president and CEO of the Independent Insurance Agents and Brokers of America.

Charles E. Symington, IIABA senior vice president for external and government affairs, said, “We hope the Senate will take up this legislation in the near future and we look forward to working with Senate leadership to move the bill to the Senate floor as soon as possible.”

Crerar added that, “This bipartisan approach to broker licensing cuts through regulatory red tape, helps consumers and helps businesses operating in multiple jurisdictions.  It is supported by every stakeholder group, including the National Association of Insurance Commissioners, and is on a path to final passage.” 

Adding the voice of carriers, Jimi Grande, senior vice president of federal and political affairs for the National Association of Mutual Insurance Companies said, “By streamlining the licensing process for agents and brokers across state lines, this legislation will increase competition to the benefit of those in the marketplace for coverage, while still maintaining the state’s authority to regulate the marketplace and protect consumers.” 


The Property Casualty Insurers Association of America says it has been a strong supporter of NARAB II.

"NARAB II is commonsense legislation and it would create a streamlined agent and broker licensing system that strengthens the competitive insurance market while maintaining important consumer protections. It sets precedent for state-based uniform national reform as it allows agents and brokers to more efficiently operate on a multi-state basis,” concludes Nat Wienecke, PCI’s senior vice president of federal government relations, in a statement.  

The National Association of Professional Insurance Agents, which endorsed NARAB II, says it "favors innovations that streamline agent and broker licensing, so long as they do nothing to undermine the principle of state-based regulation of insurance."

Supervisory authority over NARAB II should never be granted to the Federal Insurance Office. That would constitute both a breach of the statutory prohibition against the FIO acting as a regulator of insurance and an assault on the principle of state-based regulation of insurance," PIA says in a statement.


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