WASHINGTON, D.C., Sept. 9, 2009 —The Independent Insurance Agents & Brokers of America (the Big “I”) today praised the U.S. House of Representatives for passage of H.R. 2571, the Nonadmitted and Reinsurance Reform Act of 2009, sponsored by Rep. Dennis Moore (D-Kan.) and Rep. Scott Garrett (R-N.J.). The legislation, often referred to as the “surplus lines bill,” is another example of a positive targeted approach to insurance regulatory reform.
“The Nonadmitted and Reinsurance Reform Act is an excellent example of a pragmatic approach that helps bring targeted reform to the state insurance regulatory system,” says Charles E. Symington Jr., Big “I” senior vice president for government affairs. “We appreciate Representatives Moore and Garrett for introducing this measure and applaud the House of Representatives for passing it today. We look forward to working with the Senate for passage this Congress.”
The legislation singles out two areas where there is general consensus for reform: surplus lines regulation and reinsurance supervision. Independent insurance agents and brokers play a crucial role in surplus lines (or nonadmitted) insurance, which provides coverage for unique or hard-to-place property-casualty risks.
The bill modernizes surplus lines regulation by making the insured’s home state the source of regulation for individual surplus lines transactions. The bill also seeks to reduce overlapping, multiple-state regulation of both reinsurer financial condition and credit-for-reinsurance on the balance sheets of ceding insurers.
“By applying single-state regulation and uniform standards to the nonadmitted and reinsurance markets, this bill, along with giving the state sole regulatory authority, will strengthen the state-based insurance regulatory system,” says Tom Koonce, Big “I” assistant vice president for federal government affairs.
Similar legislation passed the House in the 109th and 110th Congresses with overwhelming support from both sides of the aisle.
“The Big “I” believes that such strong bipartisan congressional and near-unanimous industry support proves that this model of limited reform is the appropriate and most practical approach to modernize insurance regulation,” continued Koonce.
Founded in 1896, IIABA (the Big “I”) is the nation’s oldest and largest national association of independent insurance agents and brokers, representing a network of more than 300,000 agents, brokers and their employees nationally. Its members are businesses that offer customers a choice of policies from a variety of insurance companies. Independent agents and brokers offer all lines of insurance—property, casualty, life, and health—as well as employee benefit plans and retirement products. Web address: www.independentagent.com.