The bill reflects thecongressional intent of Dodd-Frank that the CFPB should not engagein regulatory activity related to the business of insurance.(Image: Shutterstock)

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U.S. Senators Tim Scott (R-S.C.), Mike Rounds (R-S.D.), TammyBaldwin (D-Wis.), and Joe Manchin (D-W.Va.) have introducedlegislation that would make it clear that the ConsumerFinancial Protection Bureau (CFPB) may not regulateinsurance.

The bill, S.2702, says that it would "amend the ConsumerFinancial Protection Act of 2010 to clarify the authority of theBureau of Consumer Financial Protection with respect to personsregulated by a State insurance regulator, and for otherpurposes."

'State-based system for insurance regulation has beeneffective'

Nat Wienecke, senior vice president for federal governmentrelations at the Property Casualty Insurers Association of America(PCI), said in a statement that the PCI "applauds the leadershipand bipartisan efforts of Senators Scott, Rounds, Baldwin, andManchin for introducing this important legislation that recognizesthat our state-based system for insurance regulation has beeneffective in protecting consumers and fostering competitiveinsurance markets for over 150 years.

"When Congress created the CFPB in the Dodd-Frank Act, it choseto exempt the business of insurance from its jurisdiction, but theCFPB has overstepped its boundaries in some instances. Thisimportant bill reflects the congressional intent of Dodd-Frank thatthe CFPB should not engage in regulatory activity related to thebusiness of insurance."

Avoid duplicative or conflicting regs

The president and chief executive officer of the American Council of LifeInsurers (ACLI), Dirk Kempthorne, said in a statement that thebill "will provide certainty for insurers and consumers that therewill not be duplicative or conflicting consumer protectionregulations in the future."

The House Financial Services Committee marked-up companionlegislation in January.

Steven A. Meyerowitz, Esq., is the directorof FC&SLegal, the editor-in-chief of the Insurance Coverage LawReport, and the founder and president of Meyerowitz CommunicationsInc. Email him at [email protected].