Federal Insurance Department
Agents For Change
There is movement to enact an
Optional Federal Charter-OFC to allow producers the option of being regulated at either the federal or the state level. Insurance is currently regulated at the state level.At the forefront of this change is the
“Agents for Change?” Trade Association.
This is a consortium of insurance agents and brokers from across all lines of insurance working together to reform insurance regulation and enact an optional federal charter (OFC) to allow producers the option of being regulated at either the federal or the state level. Members of Agents for Change participate in policy development and provide public policy makers with expert advice as they move forward to modernize insurance regulation.
The Agents for Change Trade Association advocates that there are distinct advantages for agents and brokers within the framework of an OFC. This includes:
- Time spent on licensing issues would be greatly reduced.
- Speed to market of products would be greatly enhanced.
- Consumers would have more products at more competitive rates.
- The ability to better serve customers no matter where they may reside.
Insurers would be able to bring their products to market more quickly because they would only have to obtain approval from a single regulatory body, rather than in multiple states as they do now under the patchwork quilt of state regulation. And consumers, who often move from state to state in today’s economy, would benefit from more stable insurance premiums and consistent administration and regulation of their insurance policies.
Insurance producers currently carry an average of 7.9 separate licenses per producer. A recent study conducted by researchers at Temple University revealed that the estimated cost of the current system of producer licensing is $431,733,400 with an assumed cost per license of $100. Under the National Insurance Act-NIA (Introduced in 2007 by Senators John Sununu (R-NH) and Tim Johnson (D-SD), savings could range from $268 to $377 million per year in licensing fees alone as a single license would be required. These savings would be passed along to consumers.