Status of the Nonadmitted and Reinsurance Reform Act of 2008
There is good news to report. During yesterday's hearing Senator Dodd noted the "consensus" that has developed on the issues surrounding reform and modernization of the surplus lines market and, especially, in respect of Senate Bill 929, the "Nonadmitted & Reinsurance Reform Act." Senator Mel Martinez (R. FL), who jointly introduced the Bill with colleague Senator Bill Nelson (D. FL) following its unanimous passage in the House of Representatives, also stated during the Hearing that the legislation would "boost the vitality of surplus lines and provide coverage for and protection of consumers," especially in coastal states. Click here for a full copy of S 929.
Among all panelists yesterday, only the representative from the Consumer Federation of America voiced opposition to S 929. Others were either fully or mostly in support of the measures to, among other things, modernize the filing and payment of multi-state surplus lines premium taxes in the home state of the insured, provide more direct access to surplus lines coverages, make eligibility requirements more uniform, and eliminate the extra-territorial provisions in reinsurance treaties. Those not fully supportive of the bill responded that there were some "tweaks" they would like to see made to the legislation.
This left the Committee Chairman to remark prior to the conclusion of the Hearing that he "would like to move forward on a reform measure that is narrow in scope and on which there is consensus." Admitting he had not surveyed his colleagues on the Committee to ascertain whether there was support for such an effort - including voting S 929 out of Committee - he said he would be doing so in the hope that "something can be done before we adjourn" for this year.
Following the meetings with Senate staff and other industry representatives after the Hearing, the AAMGA will submit supplementary remarks, data and undertake a grassroots effort to move this important legislation forward. Notwithstanding the absence of any formal hearing on just S 929, the Senate could adopt the measure by unanimous consent, thus foreclosing the necessity of a full debate and vote on the Senate floor. Given the unanimous passage of the Bill by the US House of Representatives in each of the last two years, there is a better than even opportunity for us to achieve the benefits provided by the measure. We will keep all AAMGA members advised of developments and the progress made.
Copies of the prepared remarks of Senator Dodd and Senator Tim Johnson (D. SD), as well as others who testified can be downloaded by clicking on the hyperlinks below.
Member Statements
Witness Testimony
Honorable Steven M. Goldman,
Commissioner, New Jersey Department of Banking and Insurance, on behalf
of the National Association of Insurance Commissioners.
Mr. Travis B. Plunkett, Legislative Director, Consumer Federation of America.
Mr. Alessandro Iuppa, Senior Vice President, Zurich North America, on behalf of the American Insurance Association.
Mr. John L. Pearson,
Chairman, President, and Chief Executive Officer, The Baltimore Life
Insurance Company, on behalf of the American Council of Life Insurers.
Mr. George A. Steadman, President and Chief Operating Officer, Rutherfoord Inc., on behalf of the Council of Insurance Agents & Brokers.
Mr. Thomas Minkler, President, Clark-Mortenson Agency, Inc., on behalf of the Independent Insurance Agents & Brokers of America.
Mr. Franklin Nutter, President, Reinsurance
Association of America.
Mr. Richard Bouhan, Executive Director, National Association of Professional Surplus Lines Offices.