California Insurance Commissioner Opposes Optional Federal Charter

March 16, 2009

California Insurance Commissioner Steve Poizner warned state insurance regulators to be engaged in opposing national attempts to weaken the current state-by-state insurance oversight, speaking at the National Association of Insurance Commissioners (NAIC) Spring 2009 National Meeting in San Diego.

“We must emphasize that, in one sense, the current economic problems underscore the success of state regulation – insurers are generally strong and able to meet their obligations,” Poizner said. “There is, however, a serious risk that some will use the country’s turmoil as leverage to impose federal regulation on the insurance industry.

“I remain a strong supporter of state-based regulation, but we simply cannot hope to stave off increased federal involvement with a ‘just-say-no approach.’ It is imperative that we remain aggressively engaged in this debate because, in my view, it is the most important issue we now face.

“As you conduct your work here over the next few days, I encourage you to keep this in mind. We are in a time when external conditions create great pressure for change. The current financial meltdown will be used by the advocates of Optional Federal Charter and other forms of increased federal regulation to claim that taking power from state regulators will somehow make the insurance industry stronger. In fact, the day after tomorrow the Senate Banking Committee will hold a hearing on ‘Perspectives on Modernizing Insurance Regulation.’ Call it a hunch, but I don’t expect them to come out with a strong endorsement for existing state regulation. Determining how we respond to these pressures must be our top priority.”

The NAIC hosts quarterly meetings to facilitate coordination between the individual states regulatory efforts. The last meeting held in California was June 2008.

Source: CDI

Was this article valuable?

Here are more articles you may enjoy.