State Lawmakers Plan Summit To Oppose OFC

A group of state legislators who focus on insurance said they are planning to hold a strategy summit with various official groups to plan opposition to any federal involvement with insurance regulation.

The National Conference of Insurance Legislators' (NCOIL) announcement came in an announcement noting that the Council of State Governments (CSG) had recently restated opposition to federal insurance chartering and called on state officials to convene a meeting to discuss financial regulatory reform.

NCOIL said it applauded the Council's positions.

New York Sen. James Seward, R-Oneonta, the NCOIL president, said in a statement he commended the Council for adopting a Resolution Opposing Continuing Federal Insurance Chartering Efforts during its Annual State Trends & Leadership Forum last week in Omaha, Neb.

NCOIL, said Sen. Seward, “agrees with the CSG resolution–which strongly opposes the creation of federal insurance mechanisms, such as an optional federal charter (OFC) and an Office of Insurance Information (OII).

“NCOIL, like the CSG in its resolution, also aggressively refutes the implication that failures at American International Group (AIG) somehow reflect on state regulatory oversight–a myth that has been debunked several times over,” he said.

His statement stressed the need for state officials to “come together and develop consensus positions regarding the future of regulatory reform.”

He noted that legislators and certain insurance commissioners had supported the consensus development idea during a Legislative Liaison session at the National Association of Insurance Commissioners (NAIC) Winter Meeting in Texas this week.

Mr. Seward said, “States cannot sit idly by as our carefully crafted consumer protection laws and strong solvency requirements are replaced by an untested federal system. The ongoing financial crisis has again confirmed that deregulation via optional, or mandatory, federal regulation does not protect American consumers.”

Next year, he said, “it will be more important than ever for state officials, including governors, attorneys general, insurance commissioners and legislators, to work in unison to safeguard our regulatory authority to protect our consumers and businesses. The business of insurance provides millions of jobs to our constituents and is a top five revenue source in every state across our nation.”

Announcing plans for a strategy summit of state officials, Sen. Seward said, “We will soon send letters of inquiry to leadership of national organizations, including the NAIC, National Governors Association (NGA), National Association of Attorneys General (NAAG) and the National Conference of State Legislatures (NCSL) to gauge interest in a joint meeting. Recognizing that time is of the essence, we should gather early next year so the states may have a unified voice in Washington, DC.”

The CSG Resolution was signed by CSG's president, Connecticut Governor Jodi M. Rell, and by CSG's chair, North Dakota State Rep. Kim Koppleman, R-Fargo.

NCOIL's president-elect, Kentucky State Rep. Robert Damron, D-Fayette, and NCOIL's past president, Rhode Island State Rep. Brian P. Kennedy, D-Hopkinton, were among the resolution's co-sponsors.