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What Else Is Ahead for 2005?

See related article: "The Spitzer Effect on Capitol Hill" As the New Year begins, we take time to look ahead at issues of importance...
February 8, 2005

Additional Issues of Legislative Importance for PIA Members

By Kellie Bray
Senior Director of Political Affairs
PIA National

See related article:"The Spitzer Effect on Capitol Hill"

As the New Year begins, we take time to look ahead at issues of importance to PIA members and independent agents that may see action in the 109th Congress.

Natural Disaster

The recent devastation from the tsunamis in Asia, in addition to the terrible hurricanes here in the United States last fall, will likely bring the issue of Natural Disaster closer to the forefront of Congressional legislation.

In December, PIA National submitted written comments to both the National Association of Insurance Commissioners (NAIC) and the National Council of Insurance Legislators (NCOIL) during their winter meetings.

The comments submitted outlined PIA National's view that a coordinated state-federal mechanism must be initiated to address a natural disaster funding solution.  Given the unanticipated nature and enormous scale that natural disasters reach, it is often overwhelming for the private sector to handle.  Likewise, individual states cannot afford to establish and fund their own individual solutions to these catastrophes. PIA's position was noted in a December article in USA Today.

Crop Insurance

The Committee on Agriculture, Nutrition and Forestry held a nomination hearing on January 6, 2005 for Nebraska Governor Michael Johanns to be the Secretary of Agriculture for the United States Department of Agriculture.  The Committee unanimously supports Governor Johanns for the post.

With a new Secretary taking the reigns soon, staff and priorities could change under the new administration.  However, PIA National staff will work continuously to ensure that issues such as crop insurance remain a top priority for the agency.

At a meeting of the Federal Crop Insurance Corporation (FCIC) board on Friday November 19, all pending applications for Premium Reduction Plans (PRPs) for the 2005 reinsurance year were denied. The board also mandated that no new PRP applications will be approved until the U.S. Department of Agriculture's Risk Management Agency (RMA) completes a rulemaking procedure.

In taking the actions, FCIC has recognized that a mechanism must be in place to ensure that RMA, together with state Departments of Insurance, can continue to deliver quality insurance to America's farmers - and that this process includes considering suggestions from PIA National and other insurance interests participating in crop insurance at the federal and state level. This is a positive development for the marketplace and a prudent move.

Flood Insurance

During their December meetings, the Catastrophe Insurance Working Group of the NAIC met to discuss several issues including flood insurance.

FEMA representative Edward Connor addressed the group to discuss the implementation of Section 207 of S, 2238. This section requires the Director of FEMA to work with states and the insurance industry to establish minimum training and continuing education requirements for insurance producers that sell flood insurance.

Mr. Connor encouraged states that do not currently include flood insurance provisions in producer licensing tests and continuing education to consider enacting a section of an NCOIL model law that deals with the topic.

Do Not Fax

The Junk Fax Prevention Act of 2004 was introduced to restore the Existing Business Relationship (EBR) exception prior to the enforcement of its elimination on July 1, 2005. The bill is expected to pass early in 2005. If it does, agencies would be allowed to send faxes to any persons with whom they have an existing business relationship. Any faxes would, however, be required to include an opt-out provision to allow the receiver to opt-out of any future faxes from the agency.

Trade associations that are tax-exempt nonprofit organizations would also be permitted to send unsolicited faxes without the opt-out provisions to their members in furtherance of the association's tax-exempt purpose.

PIA recommends that agencies do their best to obtain written consent from any individuals to whom they send faxes as part of their regular business practices. Since the method of obtaining consent is not restricted until July 1, 2005, obtaining consent will be much easier now than it will be after July.

PIA will alert all members to the status of the Junk Fax Prevention Act of 2004 as it moves through Congress and will provide a final guide to compliance when the bill finally passes or fails.

Kellie Bray is Senior Director of Political Affairs for PIA National.

PIA Connection

This article originally appeared in the January 2005 PIA Connection.