The CIAB’s call for adoption of insurance reforms at the federal level (see previous article) was also endorsed by the Property Casualty Insurers Association of America.
Testifying before the Capital Markets Subcommittee of the House Financial Service Subcommittee, PCI Chairman Anthony Dickson told the leislators that the trade group shares the goals of developing a more competitive insurance marketplace and supports the general reform concepts outlined in the regulatory reform road map proposed by congressional leaders.
PCI also urged federal lawmakers to focus their efforts on well-defined measures that address the most significant regulatory obstacles to a competitive insurance market.
Dickson, president and CEO of New Jersey Manufacturers Insurance Company, commented: “PCI shares Chairman Baker’s goal of strengthening and improving the state regulatory system. First and foremost, PCI believes that the greatest chance to achieve this goal, both politically and functionally, is a narrowly targeted package designed to address the core problem of the current regulatory system – namely antiquated price controls that impose barriers to market-based pricing systems. PCI urges the subcommittee to place the highest priority on competitive market reforms and focus its legislative effort in this direction.”
Dickson pointed out that reforms enacted in 2003 in his own home state of New Jersey are already contributing to improved market conditions in the state. “New Jersey drivers now have access to policies from more companies and, in several instances, at reduced rates,” Dickson stated.
He also expressed PCI’s support for the boundaries established by Reps. Oxley and Baker in their regulatory reform road map. In a presentation to state regulators at the NAIC spring meeting earlier this month, Rep. Oxley stated that the Financial Services Committee would not pursue legislation to create an optional federal charter, a federal regulator or a dual federal-state regulatory system.
“Creating new oversight institutions or layers of reporting will drive up the cost of insurance products, make it harder for smaller companies to compete, and ultimately reduce consumer choice,” Dickson continued. “As a result, attempts to unnecessarily expand the regulatory or oversight role of the federal government or NAIC or to create a new and duplicative layer of quasi-regulatory authority are almost certain to introduce needless controversy into any reform measure.”
He stressed that the PCI supports the general reform concepts outlined in the Oxley-Baker plan and pledged to work with the committee to develop a reform package that meets the association’s principles. “He also expressed the association’s appreciation of the “willingness of these congressional leaders to seek input from insurers, agents, trade groups, consumer organizations, and regulators on this proposal.”
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