Washington–A key regulator and insurance industry leaders agreedat a session here that further rules changes for agent and brokercompensation, including an end to contingency commissions, appearunlikely.

In remarks echoed by insurance representatives, North DakotaInsurance Commissioner Jim Poolman said Sunday he did not believethe movement to extend changes in producer compensation rules "hasshelf life," adding later that "the issue will fade away."

William Anderson, vice president and associate general counselof the National Association of Insurance and Financial Advisers,made the same assessment.

Their comments came during a panel discussion on the opening dayof the Annual Conference of the American Council of LifeInsurers.

While the issues discussed by the panel dealt with thelife/health industry, the discussion about producer compensationwas also relevant to the property-casualty industry because Mr.Poolman is chairman of the Producer Licensing Working Group of theNational Association of Insurance Commissioners.

Mr. Poolman noted during his comments that he did not supportrecent changes in compensation disclosure regulations in theProducer Licensing Model Act recently approved by the NAIC.

One of the reasons he didn't support the amendments to the ModelAct, he said, was that some of the underwriters and members of suchtrade groups as the Independent Insurance Agents and Brokers ofAmerica had agreed voluntarily to disclose details of theircompensation.

He also said he did not support the changes because commercialinsurance bid-rigging by major brokers, that has been uncovered andis being prosecuted by New York Attorney General Eliot Spitzer, isillegal under existing law. In Mr. Poolman's view the attorneygeneral's activities didn't touch on the issue of contingencycommissions, and prosecution of such wrongdoing did not require newlaws.

Mr. Spitzer has suggested, however, that major brokers acceptedundisclosed fees paid by insurers as part of arrangements to fixprices.

Mr. Poolman, a Republican, also appeared to suggest that Mr.Spitzer's activities were politically motivated. "AG also standsfor aspiring governor," he said, a reference to the fact that Mr.Spitzer is a Democratic primary candidate for governor.

Comments from members of the panel indicated a belief that Mr.Spitzer's investigations, in which he has been joined by stateofficials in California and Connecticut, would not bring aboutmajor changes in industry producer practices.

This despite the fact the New York attorney general has reachedlegal agreements for changes in disclosure and other practices bylarge brokers, who have agreed to pay over $1 billion inrestitution to customers.

Mr. Spitzer's legal actions also have led such large insurancebrokers as Marsh, Aon and the Willis Group–the industry leaders–toeliminate contingent commissions.

One of the panel members added, "The issue is fading away intothe sunset."

J. Bruce Ferguson, senior vice president, state relations at theACLI, said that "some of the dire predictions" associated with theSpitzer probe, including claims of "widespread corruption" byinsurance producers, "have not come true."

Mr. Ferguson did say that the changes to the Model Act approvedby the NAIC as a result of the Spitzer probe "are designed to bringtransparency to the broker compensation process."

Mr. Poolman said that in his state, "you start banningcontingency commissions, and some of the smaller rural agencieswill go out of business and the existing producer distributionsystem dries up."