Frank Keating, president and CEO of the American Council of Life Insurers (ACLI), issued the following statement in response to news reports of comments by House Financial Services Committee Chairman Barney Frank (D-MA) in support of the creation of a federal insurance regulator for the life insurance industry:
Washington, D.C. (March 5, 2009) -- “ACLI sincerely appreciates Chairman Frank’s recognition of the overwhelming need to establish a federal insurance regulator for the life insurance industry. We look forward to working with Chairman Frank to develop a strong, effective, consumer-oriented system.
“The federal government must develop a structure to effectively identify and address risks to life insurance markets and identify potential threats to life insurance industry consumers and the broader financial system. We are a $5 trillion industry that touches the lives of nearly all Americans through our individual life, group life, long-term care, disability and retirement security products. Life insurers do business across state lines and national borders. We are interconnected with banks and securities firms. It is no longer acceptable to have a regulatory system that walls off the federal government from any oversight of an industry that plays such a large and vital role in the American economy.
“Moreover, life insurance industry consumers deserve consistent and high standards of market conduct protection no matter where they live across the United States, as well as the ability to purchase a full range of life insurance and retirement security products. The system endorsed by Chairman Frank will allow federally-regulated insurers to respond quickly to consumer needs for new products while adhering to state-of-the-art standards for consumer protection. Chairman Frank also recognizes that a federal system may not be appropriate for all insurers and that state oversight should remain available for those companies and their customers. We agree and will continue to work to strengthen state regulation and make it more uniform and efficient.
A federal insurance regulator will also, for the first time, provide our nation with a strong voice who can negotiate with fellow regulators overseas on international solvency and trade concerns.
“Chairman Frank’s statement is another step on the road towards a modern, responsive insurance regulatory system, but a major step. We pledge to do everything we can to help Chairman Frank reach the finish line on an initiative that is vital for the enhanced protection of our financial marketplace.”
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The American Council of Life Insurers (ACLI) is a Washington, D.C.-based trade association whose 340 member companies account for 93 percent of the life insurance industry’s total assets in the United States, 94 percent of life insurance premiums and 94 percent of annuity considerations. In addition to life insurance and annuities, ACLI member companies offer pensions, including 401(k)s, long-term care insurance, disability income insurance and other retirement and financial protection products, as well as reinsurance. ACLI's public Web site can be accessed at www.acli.com.