Regulation/Legislation

Two House Democrats last week introduced legislation that would repeal the antitrust exemption afforded insurers under the McCarran-Ferguson Act, but would retain the authority of states to regulate the industry.

In the midst of our worst economic crisis since The Great Depression, everyone is eager to choose one target as the scapegoat for the entire financial mess. Not surprisingly, most are pinning a good part of the blame on AIG

As discussions heated up over whether to give Washington broad authority to regulate insurers posing systemic risks to the economy, the controversy cooled somewhat last week over retention bonuses paid to players at AIG's Financial Products unit.

Treasury Secretary Timothy Geithner's cautious statements of support for an optional federal charter for insurers is provoking reactions pro and con from property-casualty insurance company trade groups.

A lawyer for American International Group told a Connecticut legislative committee yesterday that attempts to cancel controversial AIG Financial Products unit bonuses would cause marketplace confusion.

Establishing a national regulator responsible for overseeing solvency and insurance pricing and products would help fix the "critical shortcomings" in the property-casualty insurance industry's current state-based regulatory structure, a report says.

The New York State home insurer of last resort said it will expand offerings by offering coverage for a wide variety of additional perils it does not currently insure.

Insurers are not currently contesting directors and officers' legal defense claims related to the Bernard Madoff pyramid scheme, but carriers are examining proceedings to see if they can stop payments, legal experts said.