Ala., Ga., La. Commissioners Discuss Untangling the Regulatory Environment

In times of disaster the insurance industry is supposed to shine, and your industry did,” Alabama Insurance Comm-issioner Walter A. Bell commented during a panel discussion at the Society of Insurance Research annual conference held recently in Atlanta. Bell was participating in the discussion, “The Regulatory Environment – Untangle So You Can Work Smarter,” moderated by Ginger Johnson, Alfa Insurance director of compensation, with panelists Georgia Commissioner John W. Oxen-dine and Louisi-ana Commis-sioner J. Robert Wooley.

“There are no more important issues than federal versus state regulations and proponents have dug in on both sides,” Bell explained. He said if the industry were federally regulated companies would have to pay double taxes. Bell pointed out that insurance company revenue provides a majority of the general fund income and that if companies resist the double taxation states would lose most of their budget.

“No one is more capable of goofing everything up than the federal government,” Oxendine said. “If the State Modernization and Regulatory Transparency Act (SMART) takes effect I’ll give up politics and become a rich trial lawyer.”

He maintained that the federal government shouldn’t interfere with family life and income and that if SMART proposals take effect it will provide a field day for trial attorneys.

Commissioner Wooley said he didn’t think the U.S. Congress will pass the SMART Act anytime soon. He said that when Louisiana attempted to regulate insurance companies they began to leave the state and found out the hard way that competition is the best way to regulate it.

Elsewhere at the SIR conference, panelists at a “Hot Topics” workshop suggested that the insurance industry has become the “whipping boy” of state attorneys general and state insurance commissioners, many of whom will likely throw their hats into the 2006 governor’s races in their states.

In a half-joking, half-serious discussion David B. Reddick quipped, “Does anyone know what insurance commissioners and state attorney generals have in common?”

Reddick, National Associa-tion of Mutual Insurance Companies (NAMIC) state affairs manager for the southeast, then ticked off a list of states: California, Connecticut, Florida, Minnesota and New York. All these states have launched insurance industry probes; all five insurance commissioners are potential governors in 2006.

The “Hot Topics” panelists–all NAMIC officials– Kenneth R. Marshall, state affairs information manager; Red-dick; Peter A. Bisbe-cos, director of legal and regulatory affairs; and Joe Thesing, state affairs manager for the central region, suggested the National Associa-tion of Attorneys General (NAAG) nickname should be the “aspiring governors association.” They pointed out that at the Web site, http://www.naag.org, political interaction obviously motivates the actions of many NAAG members, as is obvious from the “causes” they have chosen to pursue, such as antitrust, bankruptcy, civil rights, medical fraud, tobacco and violence against women.

Topics Legislation Louisiana Market