Trade groups urged state insurance commissioners meeting here to oppose a bill before Congress that would eliminate insurers' antitrust provisions in the McCarran-Ferguson Act, warning that it would diminish state regulation.

The caution came from an industry liaison group speaking at the National Association of Insurance Commissioners summer meeting.

Among the potential harm that the proposed repeal would cause, they said, is a multilayered system of regulation and a new source of litigation.

"Congress' temperament today is probably the most serious that I have seen," Patricia Borowski, a representative with the National Association of Professional Insurance Agents, Alexandria, Va., told regulators.

She said "ignorance" about insurance markets continues. Consequently, according to Ms. Borowski, it is important to speak with local representatives in Congress to educate them about markets. And, that education process will be advanced if insurers are able to break out data about top carriers and lines of business in these local representatives' districts, Ms. Borowski continued.

Among the other trade groups that warned of the threat to state regulation were the American Council of Life Insurers and the American Insurance Association, both in Washington, and the Property Casualty Insurers Association of America (PCI), Des Plaines, Ill. In addition, the National Association of Mutual Insurance Companies, Indianapolis, joined in signing a letter with 10 insurance trade groups including the Council of Insurance Agents & Brokers, the Financial Services Roundtable, both in Washington; the Independent Insurance Agents and Brokers of America, Alexandria, Va.; and the Reinsurance Association of America, Washington.

Dave Snyder, an AIA representative, said the bill would create a duplicative system of regulation by state insurance regulators and the Federal Trade Commission.

It would also result in "regulation by litigation," he added. The reason, according to Mr. Snyder, is that states would have to prove they had the right to regulate where there was not that need under current McCarran-Ferguson provisions.

In fact, the bill could result in possible triple regulation, according to the ACLI's Michael Lovendusky. In addition to state regulation and the FTC, the Justice Department may also regulate insurers, he warned.

Special Reports /

Fight McCarran-Ferguson Repeal, Insurers Tell NAIC

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