Washington, D.C. (December 13, 2011) - The American Council of Life Insurers (ACLI) responded today to the request from the Federal Insurance Office (FIO) for input on ways in which insurance regulation in the United States might be modernized and improved.

In its filing, ACLI noted that more efficient and effective life insurance business regulation has been a top priority for ACLI for a number of years.  A new survey of members on insurance regulations found that many problematic aspects of insurance regulation ACLI first identified in 1999 remain in place today.

“While our state-based regulatory system has served the industry well over the years and withstood the recent financial crisis admirably, that system has, in some respects, not kept pace with the evolution of the life insurance marketplace,” the ACLI said in its filing. It went on to note that “. . .  in many areas of regulation a lack of uniformity from state to state persists both in terms of the laws and regulations themselves and in terms of their interpretation and enforcement. This lack of uniformity is a major impediment to an efficient and cost-effective regulatory system.” 

“It is also clear that life insurers are uncertain that the current state regulatory regime can effectively represent the interests of companies and their customers in a system that is increasingly subject to regulations issued by federal and international bodies,” ACLI said.

“The ACLI’s current policy position on regulatory reform, as established by its board of directors in 2000, calls for a two-track approach to the issue, with one track focusing on improvements to our state-based system and the second track calling for the implementation of an optional federal charter,” ACLI said.

The ACLI’s policy position remains unchanged, although a new review of ACLI’s policy position is under way.