Consumer oriented reform of the surplus lines insurance marketplace is a step closer to reality through the introduction of the “Nonadmitted and Reinsurance Reform Act of 2007” (H.R. 1065) by Rep. Dennis Moore (D-Kan.), according to NAPSLO officials.
“NAPSLO welcomes Rep. Moore’s introduction of the bill, which is a needed piece of insurance reform legislation that will improve efficiency of the surplus lines insurance market and make property/liability insurance more readily available to consumers,” said NAPSLO Executive Director Richard Bouhan.
NAPSLO President William Newton stated that “This legislation will simplify the regulation of the excess and surplus lines business without diminishing consumer protections and provide consumers with more opportunities to secure property/liability insurance in areas where natural disasters have made insurance availability scarce.”
Rep. Moore and Rep. Ginny Brown-Waite (R-Fla.) submitted H.R. 1065, which also had several co-sponsors including Financial Services Ranking Member Rep. Spencer Bachus (R-Ala.), and Subcommittee on Capital Markets, Insurance and Government Sponsored Enterprises Chairman Paul Kanjorski (D-Penn.). The bill is similar to the “Nonadmitted and Reinsurance Reform Act of 2006" (H.R. 5637) that Rep. Moore cosponsored with Rep. Brown-Waite in the last legislative session. H.R. 5637 was approved 417-0 by the House in September, but wasn’t taken up by the Senate.
The legislation, in part, is aimed at making access to the surplus lines market easier for consumers and the brokers and agents who assist them. The “Nonadmitted and Reinsurance Reform Act of 2007” would establish national standards for state regulation of the surplus lines and reinsurance markets including a uniform system of surplus lines premium taxation, elimination of duplicative compliance requirements for multi-state surplus lines transactions and direct access to the surplus lines market for large commercial insurance buyers.
Mr. Bouhan testified before the Financial Services Committee in June 2006 to offer NAPSLO's support for the bill and said that the market access, tax and compliance concepts contained in the 2006 bill (and also included in the 2007 bill), were ideas long endorsed by NAPSLO and were essential marketplace reforms.
With the bill not being adopted last year, over the past two months NAPSLO and representatives of B&D Consulting, (the Association’s Washington representative) had contacted members of House Financial Services Committee and Senate Committee on Banking, Housing and Urban Affairs to urge Congress to enact the surplus lines and reinsurance reform bill.
Mr. Bouhan said that NAPSLO’s “top legislative priority” in this Congress is the passage of the ‘Nonadmitted and Reinsurance Reform Act” and added, “we are pleased that the first step has been taken, in the 110th Congress, to enact this legislation. NAPSLO hopes the House, again, endorses the bill and the Senate takes it up, shortly.”