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July 1, 2010 Thursday 02:05 PM EST
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US House Passes Financial Reforms; Attention Shifts to Senate
Jesse A Hamilton
WASHINGTON
The U.S. House of Representatives voted to approve the most significant revamping of financial regulatory reform in generations, leaving only the Senate in the way of an eventual presidential signature. As expected, the House vote — 237-192 — cleared the financial reform bill without difficulty. But last-minute vote wrangling in the Senate, complicated by the death of Sen. Robert Byrd, D-W.Va., left Senate Democrats without the three-fifths majority they need to clear the final hurdle this week, so the party leaders decided to get back to a final vote after the week-long July 4 recess. Because of the expected support of a handful of Republicans, proponents are anticipating a mid-July passage of the bill — even without the Democratic appointee that will eventually step in for Byrd. “At the end of the day, in regards to the insurance-specific provisions, we commend the House and the Senate … for recognizing the effectiveness of day-to-day insurance regulation, as well as the need to streamline and modernize that system,” said Charles Symington, senior vice president of government affairs for the Independent Insurance Agents & Brokers of America. If signed into law, it will be known as the Dodd-Frank Act, named for its chief proponents in the Senate and House. It not only establishes a Federal Insurance Office, but it also would enact a reform that would be popular in the surplus lines sector: It would put taxation, regulatory and licensing authority exclusively into the home state of the insured, meaning that multistate policies would only have premiums taxed in a single state (BestWire, June 14, 2010). “We hope that this can serve as a model to reform other aspects of state insurance regulation,” said Symington, who suggested the agent licensing system would also be a good target for reform. As for the federal office, Symington said it will surely receive “a lot of attention” from the start. “It will be important for the various industry players here in Washington, D.C., to communicate on a regular basis with that office,” he said. In the wake of the all-encompassing efforts over health and financial reforms, there are few insurance bills of high impact likely to be taken up before next year’s 112th Congress takes over. Jimi Grande, senior vice president of federal and political affairs at the National Association of Mutual Insurance Companies, said it will be “good to allow the market and the country to move on past this debate.” And the industry will have its hands full adjusting to what is likely to become law soon. Grande said the financial reform bill has “probably more unintended consequences in this legislation than there are pages.”(Jesse A. Hamilton, Washington bureau manager: Jesse.Hamilton@ambest.com)
July 2, 2010
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