Dodd: I'd Back OFC For Life Only

WASHINGTON--The head of a key Senate Committee said yesterday he would support legislation creating an optional federal charter for life insurers, but expressed reservations about supporting a similar framework for property-casualty insurers.

Sen. Chris Dodd, D-Conn., chairman of the Senate Banking Committee, the effective gatekeeper for financial services regulation, also said there is support for property-casualty insurers having the OFC option from members of his committee, and he would hold hearings on the issue of a federal charter for all insurers.

In comments to reporters on the Treasury blueprint for regulatory reform as he waited to speak on the Senate floor on housing legislation, Sen. Dodd said, "I can make a strong case to you [for an optional federal charter] with life insurance."

But, he said, on property and casualty [insurance], "it's another matter."

"There's some very legitimate issues why state regulation makes more sense in the property-casualty area and why a federal regulatory scheme makes more in the life area."

He added, however, that "the entire area of regulatory reform in insurance is important to the committee...That's a matter we're already talking about up here. I have a number of colleagues--[Sen.] Tim Johnson, D-S.D., cares deeply about this issue. Others do too."

"We're going to try, in this whole idea of the optional federal charter. We're looking at that [and] will probably hold some hearings on it," he added.