Feds Consider Taking over Insurance Regulation

Article excerpt

Oklahoma insurance agents were urged Wednesday to lobby members of Congress to oppose legislation federalizing most insurance regulation.

Mike Pickens, insurance commissioner for the state of Arkansas, told a group of nearly 700 Oklahoma insurance agents that some federal lawmakers are trying to centralize insurance regulation in one federal agency, rather than allow each of the 50 states to handle the issue.

"Can you imagine as an agent, having to deal not with (Oklahoma Insurance Commissioner) Carroll Fisher, but having to deal with the federal bureaucracy?" he said.

Pickens, one of four state insurance commissioners addressing insurance agents as part of a continuing education event in Edmond, said U.S. Rep. John Dingell, D-Mich., has been long been critical of state regulators and urged creation of a federal insurance regulator.

Since the passage of financial reform legislation in 1999 that broke down the walls separating the banking and insurance industries, other lawmakers have joined in, including U.S. Rep. John LaFalce, D-New York, and U.S. Sen. Charles Schumer, D-New York, Pickens said.

Some of the largest insurance companies, particularly those based in the Northeast, have joined the fray and sided with LaFalce and Schumer, as has the American Bankers Association, he noted.

All those groups and individuals "strongly believe that what we really need in this country" is "a federal regulator of the business of insurance," Pickens said.

But Pickens argued that a federal regulator would be a disaster for the insurance industry.

"I haven't talked to any consumers who want a federal regulator," he said.

Pickens said consumers "want to be able to call somebody at the state Capitol, not at Washington, D.C.," to help them with their insurance complaints.

"When the insurance consumer wants to call 9-1-1 for help, they want it to be a local call, not a long-distance call," Pickens said.

He warned that a federal regulator would not be able to give consumers the "same level of priority and protection" that state regulators can provide. …