Insurance Industry Praises Financial Reform

05/23/2010

The Senate recently passed financial reform aimed at reducing the likelihood of future taxpayer bailouts for companies once deemed "too big to fail."

These companies were identified by the size and scope of their assets, and originally included several insurance agencies. The legislation, which passed with a 59-39 vote on Thursday, did not, however, implement any new day-to-day regulations for the insurance industry, according to a recent report by Reuters. Rather, it left such decisions to state legislators.

Insurance industry executives have praised Congress for recognizing that property/casualty insurers were not responsible for the recent financial crisis.

"We believe the House and Senate have both made the correct decision in recognizing the strength of the state regulatory system for insurance," Robert Rusbuldt, president and CEO of the Independent Insurance Agents and Brokers of America, said. "Property/casualty insurers played no role in creating the crisis and pose no systemic risk to the overall economy."

The Financial Regulatory Reform Bill will eliminate duplicated compliance requirements for surplus lines insurers and agents, increasing the efficiency of these individuals' procedures.

Legislation passed by the Senate is now required to merge with an earlier financial reform bill by the House of Representatives. A completed version will be sent to the president for signing.

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