Federal Chartering Hearings To Begin In June

By Steven Brostoff

NU Online News Service, May 16, 10:00 a.m., Washington--A House Financial Services Committee panel is expected to begin hearings on state regulation and optional federal chartering of insurers in June, the National Underwriter has learned.

A committee representative confirmed that the Capital Markets Subcommittee, chaired by Rep. Richard Baker, R-La., is planning a series of hearings. Industry representatives told NU that they expect to see a total of three hearings during June, each of which will be about one week apart. The hearings will examine the state of insurance regulation and the issues surrounding optional federal chartering.

While the senior Democrat on the Financial Services Committee, Rep. John J. Lafalce, D-N.Y., has introduced an optional federal chartering bill, H.R. 3766, it is not expected to be the focus of the hearings.

Gary Karr, a representative of the Washington-based American Insurance Association, praised the subcommittee and Rep. Baker for conducting the hearings. The hearings represent a chance for AIA, along with other members of the Washington-based Financial Services Coordinating Committee, to discuss their support for OFC, he said.

In addition to AIA, FSCC members include the American Council of Life Insurers, the American Bankers Association, and the Securities Industry Association.

Phil Anderson, senior vice president of government affairs with Washington-based ACLI, said he views the upcoming hearings as the beginning of the dialogue on the need for optional federal chartering. He hopes to demonstrate, he said, that the issue has wide support among insurance companies, both life and property-casualty, agents and others within the financial services community, such as banks.

ABA, through its affiliate, the American Bankers Insurance Association, has developed its own proposal. Among agent/broker groups, the Washington-based Council of Insurance Agents and Brokers also favors optional federal chartering.

But Maria Berthoud, senior vice president of federal government affairs for the Alexandria, Va.-based Independent Insurance Agents and Brokers of America, said she looks forward to the hearings as the beginning of a substantive dialogue on the importance of state regulation. IIABA supports using federal government tools to help modernize state insurance regulation, but opposes optional federal chartering. IIABA will "testify in favor of a more pragmatic solution," she said.

IIABA, she said, believes that the goal of reforming state insurance regulation can be accomplished without creating a new bureaucracy in Washington.

Special Reports /

Federal Chartering Hearings To Begin In June

Related Stories

Recommended For You