NCOIL To Resume Broker Fee Model Debate

According to NCOIL Executive Director Susan Nolan, the group will hold a special executive committee meeting on March 5 at the March 3-6 meeting in Hilton Head, S.C., to consider either endorsing the measure approved late last year by the National Association of Insurance Commissioners (NAIC), or backing a specific NCOIL model.

"The proposed NCOIL model stresses fiduciary duty and strong enforcement mechanisms," Ms. Nolan said.

In a memo to members, Ms. Nolan said that an NCOIL Steering Committee has said that NAIC efforts represent a good start, but that more is needed, including finding a brighter line between agents and brokers, and further deliberating on the inclusion of the broker's fiduciary responsibilities.

The NAIC adopted a disclosure model act Dec. 29 that focuses on those producers who received compensation from the insured for their services.

Next month, the NAIC will focus on the possibility of additional sections of the agent broker licensing law that will focus on those producers who are only compensated by the insurance companies.

At the meeting set for March 12-16 in Salt Lake City, NAIC president Diane Koken said a task force is developing a list of several questions that will be used to evaluate the disclosure model, which was tacked on to the group's producer licensing model law.

Ms. Koken, who is also Pennsylvania insurance commissioner, said companies' response to an NAIC broker compensation survey, along with testimony at the meeting, will determine whether the section on carrier-compensated agents will be adopted. The insurance industry already has expressed strong opposition to such an inclusion.