CSG Says NIMA Fails to Provide Way to Uniformity, Usurps Legislative Authority

Rick Masters, Special Counsel for Interstate Compact at the Council of State Governments released a memorandum questioning the Nonadmitted Insurance Multistate Agreement (NIMA) tax compact, saying that "NIMA fails to provide any substantial or enforceable mechanism for achieving uniformity because it fails to provide a binding agreement which pre-empts other state laws in conflict with its requirements. Moreover it unconstitutionally purports to vest authority in an Executive Branch official (e.g. the Insurance Commissioner) to bind the Legislature of a State which adopts it. NIMA thus usurps Legislative authority because the action which NIMA authorizes to be taken by the Insurance Commissioner contains no limitations or conditions upon which such uniform regulations could be developed or which a state insurance department is otherwise authorized to undertake within its own state."