STATEMENT FROM NAIC PRESIDENT ALESSANDRO IUPPA ON FEDERAL INSURANCE BILL

“As state government officials responsible for supervising the insurance industry, members of the National Association of Insurance Commissioners are proud that our nation’s state-based system of insurance protections has successfully safeguarded consumers and ensured the solvency of U.S. insurance markets for for over 135 years. However, a new proposal unveiled today by Senators Sununu and Johnson would fundamentally dismantle the current system and allow insurance companies to opt out of state oversight and policyholder protections.”

“The nation's state insurance officials share significant concern that this bifurcated regulatory regime with redundant, overlapping responsibilities will result in policyholder confusion, market uncertainty and dislocation, and a host of other unintended consequences that will harm taxpaying individuals, families and businesses.”

“The members of the NAIC instead strongly believe that a coordinated, national system of state-based insurance supervision has and will continue to meet the needs of the modern financial marketplace while preserving protections for individual and commercial policyholders. To this end, state insurance officials are working to continuously retool and upgrade state supervision to provide multi-state platforms and uniform applications to leverage technology and enhance operational efficiency. A perfect example of these efforts is our tremendous success enacting the Interstate Compact for life insurance and other investment-oriented insurance products. Legislatures in 23 states have passed the Compact since 2004, and we expect to exceed the 26 states required this year to begin operations.”

“The NAIC and its members representing the citizens, taxpayers, and governments of all 50 states, the District of Columbia and the territories will continue to share our expertise with Congress on insurance issues having a national impact and welcome congressional interest in our modernization efforts. At the same time, we will emphasize our primary mission to provide individuals and businesses with the high level of protection, which they deserve and expect regarding complicated insurance products that are rooted in state contract and tort laws. When our record of success is measured against the uncertainties of changing a state-based system that works well at no cost to the federal government, we believe Congress will agree that regulating insurance is best left to home state officials who have the expertise, resources, and experience to protect consumers in the communities where they live.”