Measuring the Drapes

Rangel and Stark, as well as other Democrats, at the same time may be amenable to greater funding of Medicare and Medicaid programs.

Another key anticipated committee change will be at Energy and Commerce, where Rep. John Dingell, D-Mich., will again reign supreme. Under him, Rep. Henry Waxman, D-Calif., is likely to become head of the Health Subcommittee on that panel.

Waxman is also likely to head the Government Reform Committee and is likely to come down hard on the Bush administration's healthcare policies.

As stated by one veteran industry lobbyist, "The point is that coming into January 2007 most of the p-c insurance industry will be on the outside of the decision-making process." He says the life industry "is better situated, as their PACs have tried to be more even-handed in contributions reflecting the actual majorities in both houses–slightly tilted toward Republicans."

The lobbyist said that from the life industry's perspective, "they have done better under Democrats than Republicans."

"Republicans, since the Contract With America, have tried to eliminate the estate tax–the raison-d'etre for purchasing whole life insurance." It was Rep. Bill Thomas, R-Calif., retiring head of the Ways and Means panel, "who tried to repeal the estate tax and fund it by limiting the tax-deferred inside buildup on cash value life insurance policies."

"With the Democrats in control, the life industry can rest easily that repeal of the estate tax will not happen, but there could very well be attacks on the need to fund the Democratic social agenda with huge national budget deficits," the lobbyist said.

"Democrats such as John Dingell have argued for Federal insurance regulation, as did Fritz Hollings, retired Democrat of South Carolina," he said. The lobbyist believes Kanjorski will eventually support Rep. Ed Royce, R-Calif., who recently introduced a bill calling for an OFC, on an across-the-board basis.

"The American Insurance Association has been supportive of Democrats as being far more amenable to federal regulation of insurance and the repeal of the McCarran-Ferguson Act," the lobbyist said. "With more federal oversight will come scrutiny over the anti-rebating laws, as took place under Rep. John LaFalce, D-N.Y., who held hearings in the 1980s on the rebate of insurance commissions.

"I also believe that Ds will insist on more disclosure of agent commissions to consumers at point of sale–to be consistent with other financial products. This is not such a big jump, as so many of life insurance products today are hybrids and are regulated at the federal level as securities, such as variable policies."

In the Senate, regardless of whether they take control, Democrats will be less sympathetic to outright repeal of the estate tax or expensive reform. And Sen. Chris Dodd, D-Conn., will likely succeed Sen. Paul Sarbanes, D-Md., who is retiring, as the top Democrat on the Senate Banking Committee.

Another key addition to that committee is likely to be Rep. Ben Cardin, D-Md., who is leading in the race to succeed Sarbanes. Cardin was the Democratic sponsor of bipartisan legislation introduced in the House in 2001 that added tax incentives to those seeking to build retirement savings. A number of these provisions were in the pension bill finally passed by the Congress in August.

And both Dodd and Cardin, as well as other urban Democrats on the Committee, are likely to be strong supporters of the extension of the Terrorism Risk Insurance Act, and also the addition of group life to the program.