Opponents Outline Alternative To OFC

A group opposed to creation of an optional federal charter for insurers says it opposes legislation creating an OFC introduced this week in the Senate but does support “targeted” federal legislation to “modernize and reform” the current system.

The group, the Coalition Opposed to a Federal Insurance Regulator (COFIR), made its comments in response to the introduction yesterday in the Senate of S. 40, the “National Insurance Act of 2007.”

The bill was introduced by Sen. John Sununu, R-N.H., and Sen. Tim Johnson, D-S.D.

“COFIR believes that establishing a new federal bureaucracy in Washington will not benefit consumers,” said Greg Wren, COFIR executive director. “COFIR has conducted surveys of tens of thousands of consumers, and the overwhelming consensus is that centralizing insurance in our nation's capital is not the answer to issues confronting the insurance marketplace.”

COFIR is a coalition composed of property and casualty companies, life and health insurance companies, insurance trade associations, agents and brokers which oppose federal efforts to create a dual, bifurcated system of state and federal insurance laws and regulations.

The organization is based in Montgomery, Ala., and its members include the National Association of Mutual Insurance Companies and the Independent Insurance Agents and Brokers of America. Its primary financial supporter is AFLAC, based in Columbus, Ga.

In his comments, Mr. Wren said that while COFIR does not support the creation of a federal insurance regulator, the kind of legislation it does support is exemplified by the Nonadmitted and Reinsurance Reform Act of 2007.

This legislation was introduced in February by Sen. Bill Nelson, D, and Mel Martinez, R, both of Florida. An updated version is expected to be introduced soon in both the House and Senate.

“This bill has overwhelming congressional and industry support,” Mr. Wren said. “COFIR maintains that targeted legislation such as this can bring about uniformity and improve efficiencies in the state-based insurance regulatory system without taking the drastic step of creating a massive new federal bureaucracy.”