Five insurance trade groups have filed a petition asking California officials to review whether Stephen Poizner, the state insurance commissioner, has created "illegal underground regulations" concerning Iranian investments.
Poizner has compiled a list of 50 companies that are not based in Iran but, according to Poizner, are involved with Iran. He says that, starting tomorrow, he will not credit any investment in those blacklisted companies on an insurer's balance sheet.
On Friday, companies will be required to return a form notifying the California Insurance Department whether they will or will not be investing in the 50 companies on the list.
If the California Office of Administrative Law approves the 17-page petition, it could make Poizner go back to counting the Iran-related investments and add the value of those investments to insurers' capital and surplus totals.
The trade groups that filed the petition are the Association of California Insurance Companies, Sacramento, Calif.; the Association of California Life and Health Insurance Companies, Sacramento; the Personal Insurance Federation of California, Sacramento; the American Council of Life Insurers, Washington; and the American Insurance Association, Washington.
Poizner's move to create the Iran-related investments regulation without going through a normal hearing process was "well-intentioned but misguided" and could establish a "perilous precedent," the insurer groups say in a statement.
Poizner has no role in setting U.S. foreign policy, and, if the current policy stands, a future commissioner could restrict insurer investments in companies that engage in any practice that the future commissioner disagrees with or believes to be politically offensive, the groups say.
"The potential list is limited only by the imagination," the groups say.
