A national association of insurance agents has reiterated its opposition to a provision in the CHOICE act that would create the Office of the Independent Insurance Advocate within the Treasury Department. This comes before the House is expected to vote on the act on June 08.
“The CHOICE Act is designed to roll back the regulatory overreach of the Dodd-Frank Act,” said PIA National Executive Vice President & CEO Mike Becker. “Unfortunately, it also contains a provision that would create a new, expansive and unnecessary federal insurance bureaucracy. The Independent Insurance Advocate could quickly become a federal insurance czar with no supervision, positioned to usurp our strong and effective system of state insurance regulation. It runs counter to the purpose of shrinking the federal footprint.”
According to the legislation, the IIA office will come from a merger of the Treasury’s Independent Member with Insurance Expertise, and the Federal Insurance Office. The IIA will be appointed by the president for a six-year term, subject to the approval of the Senate.
Among other things, the CHOICE Act said the IIA will:
- Replace the Independent Member with Insurance Expertise as the voting Financial Stability Oversight Council member.
- Coordinate federal efforts on the prudential aspects of international insurance matters.
- Represent the US in the International Association of Insurance Supervisors (IAIS) and assist in the negotiations of covered agreements.
- Consult with state insurance regulators regarding insurance matters of national importance and prudential insurance matters of international importance.
- Assist the Treasury in administering the Terrorism Risk Insurance Act.
“If one were to draft a proposal to extend the reach of the federal government over the insurance industry, this provision of the CHOICE Act would fit the bill,” said PIA national vice president of government relations Jon Gentile. “It’s disappointing and frankly inexplicable for the CHOICE Act, which removes power from Washington in so many ways, to be used to increase the federal role over insurance.”
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