NU Online News Service
WASHINGTON –The author of legislation creating an Office of Insurance Information within the Treasury Department is urging colleagues to pass the bill when it comes to the House floor this week, saying it is needed to give the federal government “a credible source of information and expertise on insurance matters.”
Rep. Paul Kanjorski, D-Pa., in a “Dear Colleague” letter also said the measure “does not change the regulation of insurance and does not take sides in the state-versus-federal regulation of insurance debates.”
The National Association of Professional Insurance Agents, however, said in a letter released today that it disagrees with Rep. Kanjorski’s interpretation, saying it has become a bill “enabling federal insurance regulation.”
The bill, H.R. 5840, the Insurance Information Act of 2008, is due to come up on the House floor Wednesday, but some sources said the press of congressional business may delay action on it.
Rep. Kanjorski is chairman of the Capital Markets Subcommittee of the House Financial Services Committee and primary sponsor of the legislation.
He says in his letter that “parties on both sides of the [OFC] issue have offered support for my bill.”
Under the bill, Mr. Kanjorski explained, the director of the Office of Insurance Information will collect data on insurance, analyze the data and issue reports to Congress.
Additionally, he said, the OII will “establish federal policy on international insurance matters and ensure that state insurance laws are consistent with agreements between the U.S. and a foreign jurisdiction with regard to such federal policy.”
He admitted that to promote federal trade policy, the Treasury Department will have “the ability, under very limited circumstances and very detailed procedures, to preempt a state insurance measure that is inconsistent with an agreement regarding the policy made between the U.S. and a foreign jurisdiction.
“The preemption will only be used as a last resort,” he added.
Additionally, Rep. Kanjorski said, “the legislation does not upset the current process of negotiating international agreements but seeks to provide a unified voice of advice to whoever the lead negotiator is.”
But PIA National President Robert Page argued in a PIA statement, “This bill has been misleading from the outset.”
He charged that the “title of the bill is a misnomer and the rhetoric of its supporters is designed to conceal what is really going on here.”
Mr. Page said, “This piece of legislation is part of a coordinated push by advocates of federal insurance regulation to sweep away opposition and advance their agenda in a disingenuous manner.”
Kenneth Auerbach, PIA national president-elect, added, “This is no longer a bill that is only about creating an insurance information office.”
Mr. Auerbach said, “The current version of this bill would effectively lay open to review and approval by the Secretary of the Treasury the laws and practices of all 55 United States jurisdictions in most matters relating to insurance.”
He added, “People have been encouraged to read the bill more narrowly than this.”
If that is the case, he said, “then PIA wants the actual language in the bill to articulate that narrowness. The current language provides the power to determine which state laws, regulations and industry practices will be preempted, without any proper legislative authority acting to do so. This is a federal power grab.”