State lawmakers have taken a firm stand against both an optional federal charter for insurers and repeal of the McCarran Ferguson Act anti-trust exemption for insurers.
The National Conference of Insurance Legislators approved measures on both items at its summer meeting in Seattle last week.
NCOIL's Executive Committee passed a resolution opposing the Insurance Industry Competition Act, which would repeal the anti-trust exemption of the McCarran Ferguson Act, the 1945 federal law authorizing states to regulate insurance.
The resolution said that NCOIL opposes the anti-trust section repeal on the grounds that it would "jeopardize insurance practices that promote available and affordable coverage, expose insurance markets to uncertainty and litigation, and create an environment that inadvertently disadvantages consumers most in need."
As for the optional federal charter bill sponsored by Sen. Tim Johnson, D-S.D., and Sen. John Sununu, R-N.H., the lawmakers said it would "result in a quagmire of federal and state directives and promote ambiguity and confusion."
"Ultimately it would impose the costs of a needless federal bureaucracy upon businesses and the public," the group wrote in a letter to the sponsoring senators.
In other summer meeting news:
o NCOIL passed a resolution urging the states to study the degree to which they have developed and implemented hazard mitigation plans in developing land use plans.
"Mitigation isn't only about enforcing strong building codes, though that is critically important. It is also about deciding where and in what way to allow development in the first place," said North Dakota Rep. George Keiser, R-Bismarck.
o State lawmakers also debated a proposed model law dealing with guaranty funds.
Legislators in Seattle agreed that only claimants below a certain net worth deserve guaranty fund money–consistent with the idea that guaranty funds should help people most in need after their insurer becomes insolvent.
The lawmakers also debated discrepancies between the NCOIL model guaranty act and the model put forward by the National Association of Insurance Commissioners.
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