Optional Federal Charter Bill Introduced in Senate
On April 4, 2006, sponsoring Senators John Sununu (R-N.H.) and Tim Johnson (D-S.D.) introduced in the United States Senate the National Insurance Act of 2006. The 290-page bill would provide insurers with the option of applying for a federal charter for property/casualty or life companies. It is expected to be the subject of Senate hearings by the end of May.
The Senate bill is modeled after legislative proposals developed in recent years by the American Council of Life Insurers (ACLI), American Insurance Association (AIA), and American Bankers Insurance Association (ABIA). It would establish within the Treasury Department an Office of National Insurance, in some ways analogous to the existing Office of the Comptroller of the Currency. The Office of National Insurance would be headed by a commissioner appointed by the president for a term of five years.
The bill provides that receivership of nationally chartered insurers would be conducted by the federal commissioner pursuant to regulations to be promulgated and based upon the Uniform Receivership Law (URL), which in turn was promulgated by the Interstate Insurance Receivership Compact in 1998 when the member states' insurance commissioners voted in favor of the URL.
The bill would also require nationally chartered insurers to be (or remain) members of the existing state guaranty associations in states where they conduct business, unless the guaranty associations of those states are not deemed "qualified" due to failure to meet minimum standards drawn from existing NAIC guaranty association models. Nationally chartered insurers doing business in unqualified states would be required to be members of a fallback federal guaranty mechanism established roughly pursuant to NAIC models.
The full text of the bill is available here.
Staff Contact -MPC Meeting Web Page Online
The Web page for the upcoming MPC meeting, which will be held May 22-24, 2006, in Indianapolis, Ind., can be accessed here. The meeting page offers online registration as well as hotel information and other meeting details. A preliminary schedule of events will soon be available in PDF format in the "Meeting Resources" section.
The cut-off date for hotel reservations and meeting registration is April 28. We encourage you to make your reservations and register for the meeting as soon as possible.
If you have any trouble accessing the meeting Web page, please contact Dan Hicks at [email protected] or 703.787.4112. Questions concerning the MPC meeting should be directed to Sean McKenna at [email protected] or 703.787.4106.
Staff Contact - Sean McKenna States General Life Insurance Company (Tex.)Lawsuit over Premiums Withdrawn
The lawsuit involving the special deputy receiver, the guaranty associations, and Trinity Bank regarding Trinity Bank's alleged security interest in States General premiums was withdrawn on April 3, 2006, by order of the court with the consent of all three parties. Trinity Bank has instead filed a claim, and it is anticipated that the bank's claim to States General's premiums will be addressed through States General's claim process.
Task Force Chair - Tad Rhodes; Staff Contact - Joni Forsythe