Panel To Hold Second Regulation Hearing

During the first hearing, representatives for the American Council of Life Insurers, Washington, and the American Bankers Insurance Association, Washington, spoke in favor of S. 2509.

In many other countries, "insurance regulation is uniform," said Alan Liebowitz, chairman of the ABIA government policy committee. "As a result, consumers and insurers are not subject to policy or pricing differences simply because of their location."

But Rob Hardy, who spoke for the National Alliance of Life Companies, Chicago, a group that represents small insurers, supported the current, state-based system.

"Proponents of a federal regulator want a simple, one-stop shop to provide greater efficiency and uniformity for the insurance industry," Hardy said. "Based on that premise, one could argue for federalizing first responders, state health or environmental agencies, or even education. Should we simply federalize all of those functions for the sake of convenience? No one who believes in our republic can seriously believe that such action would be a good idea."

Frank Wald, president of the National Conference of Insurance Legislators, Troy, N.Y., did not testify at the hearing, but he wrote a letter to Senate Banking Committee leaders that criticizes both the Senate optional federal charter bill and House efforts to use federal "tools" to persuade states to make insurance laws and regulations more uniform.

The initiatives would interrupt states' own efforts to modernize the insurance regulation system, Wald writes in the letter.