Independent Insurance Agents and Brokers of America (IIABA) President & CEO Robert Rusbuldt is encouraging the new administration to take a measured approach to reforming the laws that govern the nation’s financial services industry.
While proponents of an optional federal charter for insurers have seized on the financial crisis to advance their agenda, Rusbuldt urges Obama to keep the state-based system in place. Not surprisingly, Rusbuldt highlights the achievements of the state-based system of insurance regulation in light of recent events.
“Even the failure of AIG, whose collapse emanated from its Financial Products division, not its insurance operations, highlights the strength of the insurance regulatory system,” he writes. “We therefore strongly encourage you to preserve the state system of insurance regulation as you engage in your financial services regulatory reform efforts. Many lessons can be learned from the current economic crisis, but one of the most significant points is that the paramount responsibilities of any financial services regulator should be both the protection of the consumer and the solvency of the institution. While in definite need of targeted regulatory reforms to enhance uniformity and efficiency, state regulation of insurance has excelled at these two primary responsibilities, and we want to ensure that this fact is not lost in the overall debate on financial services regulatory reform.”
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