Following up on our post last month, on July 24, 2007, a bipartisan optional federal charter (OFC) bill was proposed in the House by Reps. Melissa Bean (D-IL) and Ed Royce (R-CA), serving as a companion bill to the previously-filed Senate version, both of which are entitled the National Insurance Act of 2007.
The industry response to OFC legislation remains divided. Opponents insist that OFC legislation will simply create an added layer of bureaucracy and regulation for insurers and that more targeted reforms, such as the Nonadmitted and Reinsurance Reform Act of 2007 (which passed by voice vote in the House in June), more appropriately work to improve the existing regulatory system. Proponents of OFC legislation herald the concepts of a single point of filing for new products and a single regulatory body as a vast improvement to the existing 50-state system, and contend that streamlined filing and regulatory processes will allow products to come to market faster and foster competition, benefiting the consumer.
InsureReinsure.com will provide updates as they happen.