NU Online News Service, Oct. 26, 1:22 p.m.EDT

In the wake of the first congressional testimony of MichaelMcRaith, director of the new Federal Insurance Office, officials ofthe National Association of Mutual Insurance Companies say heappears to “have an understanding” of the role the new agency is tofulfill.

But, officials of the National Association of ProfessionalInsurance Agents, while expressing appreciation that McRaithaffirmed that the FIO is not a regulator, also voice concerns withremarks by McRaith that the FIO's portfolio “is still beingdefined.”

Both comments were made in response to McRaith's appearanceTuesday before the Subcommittee on Insurance, Housing and CommunityOpportunity of the House Financial Services Committee. Thesubcommittee is chaired by Rep. Judy Biggert, R-Ill.

Jimi Grande, NAMIC senior vice president, federal and politicalaffairs, says McRaith understands the FIO's role is that of an“objective, reliable resource for information” on the insuranceindustry while “the state-insurance departments remain thefunctional regulators over the business of insurance.”

Grande says NAMIC looks forward to working with McRaith as hebuilds the FIO with this goal in mind.

Grande explains, “NAMIC has long been an advocate forfocusing reform efforts on improving the state-based regulatorysystem, as was Director McRaith in his former role as a stateregulator.

“We continue to believe that any move towards afederal-regulatory system would only add duplicative, burdensomeregulation on insurers and would ultimately increase costs forconsumers without providing additional protections.”

Mike Becker, PIA National assistant vice president of federalaffairs, says that during the hearing, Biggert asked McRaith torepeat what he stated in his prepared remarks, that the FIO is nota regulator, and he did.

But later, Becker says, during an exchange about the activitiesof the FIO, McRaith stated, “The range and depth of our portfoliois still being defined.”

Becker says, “PIA believes that the FIO's portfolio has alreadybeen defined in the Dodd-Frank bill, which establishes clearparameters on the FIO's activities.”