Insurers Worried that N.J. Proposal Would Force Many Employees to Register as Lobbyists

March 15, 2005

A proposal by the New Jersey Election Law Enforcement Commission that would require most insurance company employees to register as lobbyists fails to distinguish true lobbyists who perform an “influencing” role, according to the Property Casualty Insurers Association of America (PCI).

“This proposal would define as a lobbyist almost any insurance company employee involved in rating, public contracts, permits, bidding or administration,” said Richard Stokes, regional manager for the PCI at a hearing today before the commission on the proposed lobbyists and governmental affairs agents regulations. “By failing to recognize the distinct role of the lobbyist as ‘influencing’ public policy, the proposal is inappropriate and inconsistent with legislative intent.”

Many insurer employees in their daily jobs are charged to meet certain regulatory or statutory requirements, Stokes said. Examples in the property/casualty industry include employees who assist in a Department of Banking and Insurance audit, or employees who interpret or analyze legislation and regulation, such as underwriters or actuaries. “These employees don’t influence legislation or regulation, or are part of the legislative or regulatory process – they are simply responding to the department’s requirements or the statutes regulating the industry,” Stokes said. “But under this proposal, these employees will be considered lobbyists and required to maintain detailed records about their contacts and activities. This will only create further bureaucratic oversight with little or no value.”

PCI recommends changing the proposal to exempt contacts initiated by the state or the department, or contacts made by insurers to comply with regulations or statutes or for those involved in a regulatory filing, as well as employees such as underwriters, actuaries, and customer service representatives who spend most of their time in non-governmental affairs activities.

“While PCI values maintaining a strong oversight of the governmental affairs or lobbying role, we believe this proposal needs further refinement to eliminate those employees not involved in the lobbying process,” Stokes said. “It is important to strike a balance between effective oversight regulation that will not put business and state government at a standstill.”

PCI is composed of more than 1,000 member companies.

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