WASHINGTON, July 3, 2008 — The National Association of Professional Insurance Agents today lauded action by the National Conference of Insurance Legislators (NCOIL) to warn state officials of the dangers of the Insurance Information Act of 2008 (H.R. 5840).

State insurance legislators through their organization are performing a public service by warning against this legislation, which would enable the Treasury Department to preempt state insurance laws and consumer protections. NCOIL sent letters to all state governors and attorneys general. The letters strongly urge state officials to stand up for the state-based system of insurance regulation and oppose preemptions by the federal government.

NCOIL’s action follows a June 10 hearing before the U.S. House Subcommittee on Capital Markets, Insurance, and Government Sponsored Enterprises. The urgency of the NCOIL action is heightened by the determination of subcommittee Chairman Paul Kanjorski (D-Penna.) to push the bill through, as he termed it, “in weeks rather than months.” Kanjorski has scheduled a July 9 mark-up of H.R. 5840.

“PIA is proud to stand shoulder-to-shoulder with NCOIL on this issue,” said PIA National Senior Vice President Patricia A. Borowski. “We share NCOIL’s concerns that this legislation as currently drafted could create even more legal conflicts while stepping over the authority of the states. It would set up a federal entity, the Office of Insurance Information (OII), and would allow Treasury to preempt state insurance laws that it determined were ‘inconsistent’ with international insurance agreements.”

“PIA agrees that a formal legal coordination of state and federal authorities and laws in the U.S. business of insurance is needed for international trade and treaty issues affecting the U.S. domestic insurance marketplace and those that participate in it,” Borowski said. “However, the good concepts and goals behind H.R. 5840, which should be non-controversial, are getting smothered by a form that displaces The Several States and their authorities.”

“Relegating states and insurance law to a mere information office that gathers and provides expert advice to Members of Congress is quite controversial,” Borowski said. “You can see the same concerns reflected in the conditions that the National Association of Insurance Commissioners (NAIC) presented at a June 10 hearing before the Capital Markets Subcommittee. NCOIL’s call to governors and attorneys general to engage in dialogue with their federal lawmakers is fully appropriate and timely. And since this bill raises critical concerns which must be addressed, this is the time for careful deliberation and public debate by all that have a stake in this game -- not a rush to judgment.”

Rep. Donald Manzullo (R-Ill.), a member of the Capital Markets Subcommittee says the Office of Insurance Information is a “soft punch,” to be followed by much stronger action to move the insurance industry closer to a federalized regulatory system. “This is an attempt to federalize the insurance industry,” Rep. Manzullo said. “That’s all it is.”

In addition, the two House sponsors of optional federal charter legislation are also original sponsors of H.R. 5840, Reps. Ed Royce (R-Calif.) and Melissa Bean (D-Ill.). Both lawmakers cheered the introduction of H.R. 5840, with Rep. Royce saying it “would move us one step closer to an optional federal charter.”

“The Office of Insurance Information concept is being used by OFC advocates as a vehicle to enable creation of the initial federal insurance regulatory infrastructure that, once it is established, can be rapidly transformed into the office of a federal insurance regulator,”said PIA National Executive Vice President & CEO Leonard C. Brevik. “Therefore, PIA is opposed to H.R. 5840.”

Founded in 1931, PIA is a national trade association that represents member insurance agents and their employees who sell and service all kinds of insurance, but specialize in coverage of automobiles, homes and businesses. PIA members are Local Agents Serving Main Street America (SM). PIA’s web address is www.pianet.com.