Professional Insurance Agents Reaffirm Support for H.R. 5143, the Transparent Insurance Standards Act of 2016
WASHINGTON — The National Association of Professional Insurance Agents (PIA) reaffirms its strong support of the Transparent Insurance Standards Act of 2016 (H.R. 5143), which is likely to see action in the House this week.
PIA National worked with the bill’s sponsor, Rep. Blaine Luetkemeyer (R-MO) in developing the legislation and will continue to advocate for its passage.
H.R. 5143 seeks to increase transparency and cooperation in international negotiations and to ensure that state insurance regulation is afforded appropriate deference in any federal or international decision-making process.
The proposed legislation enhances Congress’s oversight of international deliberations relating to insurance standards by requiring the U.S. Treasury Department and Federal Reserve to consult with Congress and state insurance regulators represented by the National Association of Insurance Commissioners (NAIC) before approving any international insurance standards.
The bill sets negotiating objectives for U.S. negotiators regarding international insurance standards to ensure that the U.S. doesn’t enter into an agreement that would disrupt the domestic insurance industry. It provides that if a proposed international standard includes a capital requirement, it would have to be consistent with federal and state requirements. The bill’s provisions couldn’t be interpreted to preempt a state law.
“If global standards are promulgated without appropriate consideration of the unique state-based system of U.S. insurance regulation, they may actually increase systemic risks and consumer costs by pushing small and midsize companies out of business, reducing competition,” said PIA National Executive Vice President & CEO Mike Becker.
H.R. 5143 also provides that the public has the ability to comment, and state regulators would have to be consulted, on agreements that could affect U.S. insurers. The bill mandates a separate public comment period before imposing the standard on the companies it supervises. Covered agreements couldn’t provide Treasury or the Federal Insurance Office (FIO) with general authority to regulate the insurance industry. Separately, PIA has proposed the abolition of the FIO.
“The role of the FIO in its enabling legislation is unambiguous, in that it is specifically prohibited from acting in any manner as a regulator or supervisor of the business of insurance,” said PIA National Vice President of Government Relations Jon Gentile. “It is gratifying to see Congress poised to reaffirm this principle in H.R. 5143.”
Founded in 1931, PIA is a national trade association that represents member insurance agents and their employees who sell and service all kinds of insurance, but specialize in coverage of automobiles, homes and businesses. PIA members are Local Agents Serving Main Street AmericaSM. PIA’s web address is www.pianet.com.