Dallas — Despite the upheaval in the financial markets, efforts to offer insurers an optional federal charter should continue. That’s the thrust of a new study released by the Dallas-based Institute for Policy Innovation.
“Contrary to this panic-induced urge to expand and centralize regulatory authority, regulatory competition is not the problem,” the report, written by Lawrence Hunter, states. “Properly designed, regulatory competition can be a significant part of the solution.”
Hunter said an OFC would modernize a system that puts American insurers at a competitive disadvantage in the global marketplace.
“Rather than stifling regulatory competition by centralizing regulation and eliminating choice among regulators in the name of reform, Congress should enhance and expand regulatory competition by allowing insurance companies to choose between state and federal regulation under an optional federal charter, and to have their domicile-state regulation recognized by all other 49 states if they elect to remain state-regulated,” Hunter wrote.
Source: Institute for Policy Innovation
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