2008 Legislation
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SENATE JOINT MEMORIAL NO. 114<br /> – Nat’l Insurance Act, opposition to

SENATE JOINT MEMORIAL NO. 114

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SJM114...............................................by JUDICIARY AND RULES
NATIONAL INSURANCE ACT - Stating findings of the Legislature and joining
with the National Conference of Insurance Legislators in expressing Idaho's
strong opposition to the proposed federal National Insurance Act of 2007.

03/18    Senate intro - 1st rdg - to printing
03/19    Rpt prt - to 10th Ord
03/20    10th Ord - ADOPTED - voice vote
    Floor Sponsor - Goedde
    Title apvd - to House
03/21    House intro - 1st rdg - to Bus
03/26    Rpt out - rec d/p - to 2nd rdg
03/27    2nd rdg - to 3rd rdg
    Rls susp - ADOPTED - 63-2-5
      AYES -- Andrus, Barrett, Bayer, Bedke, Bell, Bilbao, Black, Block,
      Bock, Boe, Bolz, Bowers, Brackett, Bradford, Chadderdon, Chavez,
      Chew, Collins, Crane, Eskridge, Hagedorn, Hart, Harwood, Henbest,
      Henderson, Jaquet, Killen, King, Kren, Lake, Loertscher, Luker,
      Marriott, Mathews, Mortimer, Moyle, Nielsen, Nonini, Pasley-Stuart,
      Patrick, Pence, Raybould, Ringo, Roberts, Ruchti, Rusche, Sayler,
      Schaefer, Shepherd(02), Shepherd(08), Shirley, Shively, Smith(30),
      Smith(24), Snodgrass, Thayn, Thomas, Trail, Vander Woude, Wills,
      Wood(27), Wood(35), Mr. Speaker
      NAYS -- Durst, LeFavour
      Absent and excused -- Anderson, Clark, Labrador, McGeachin, Stevenson
    Floor Sponsor - Snodgrass
    Title apvd - to Senate
03/27    To enrol
03/28    Rpt enrol - Pres signed
03/31    Sp signed
04/01    To Secretary of State

Bill Text




                                                                       
  ]]]]              LEGISLATURE OF THE STATE OF IDAHO             ]]]]
 Fifty-ninth Legislature                   Second Regular Session - 2008

                                                                       

                                       IN THE SENATE

                               SENATE JOINT MEMORIAL NO. 114

                              BY JUDICIARY AND RULES COMMITTEE

  1                                   A JOINT MEMORIAL
  2    TO THE SENATE AND HOUSE OF REPRESENTATIVES OF THE UNITED  STATES  IN  CONGRESS
  3        ASSEMBLED, TO THE CONGRESSIONAL DELEGATION REPRESENTING THE STATE OF IDAHO
  4        IN THE CONGRESS OF THE UNITED STATES, TO MEMBERS OF THE UNITED STATES SEN-
  5        ATE  COMMITTEE ON BANKING, HOUSING AND URBAN AFFAIRS AND TO MEMBERS OF THE
  6        UNITED STATES HOUSE OF REPRESENTATIVES COMMITTEE ON FINANCIAL SERVICES.

  7        We, your Memorialists, the Senate and the House of Representatives of  the
  8    State  of  Idaho  assembled  in  the Second Regular Session of the Fifty-ninth
  9    Idaho Legislature, do hereby respectfully represent that:

 10        WHEREAS, regulation, oversight and consumer protection have  traditionally
 11    and historically been powers reserved to state governments under the McCarran-
 12    Ferguson Act of 1945; and
 13        WHEREAS, state legislatures are more responsive to the needs of their con-
 14    stituents  and  the  need  for insurance products and regulation to meet their
 15    state's unique market demands; and
 16        WHEREAS, many states, including Idaho, have recently enacted  and  amended
 17    state  insurance laws to modernize market regulation and provide insurers with
 18    greater ability to respond to changes in market conditions; and
 19        WHEREAS, state legislatures, the National Conference of Insurance Legisla-
 20    tors (NCOIL), the National Association of Insurance Commissioners (NAIC),  and
 21    the  National Conference of State Legislatures (NCSL) continue to address uni-
 22    formity issues among states by the adoption of model laws that address  market
 23    conduct,  product approval, agent and company licensing and rate deregulation;
 24    and
 25        WHEREAS, initiatives are being contemplated  by  certain  members  of  the
 26    United  States Congress that have the potential to destroy the state system of
 27    insurance regulation and create an unwieldy and inaccessible  federal  bureau-
 28    cracy, all without consumer and constituent demand; and
 29        WHEREAS,  such  initiatives  include S.40/H.R.3200, the National Insurance
 30    Act of 2007, which is proposed optional federal charter legislation that would
 31    bifurcate insurance regulation and result in a quagmire of federal  and  state
 32    directives that would promote ambiguity and confusion; and
 33        WHEREAS, S.40/H.R.3200 would allow companies to opt out of state insurance
 34    regulatory oversight and evade important state consumer protections; and
 35        WHEREAS,  the mechanism set up under S.40/H.R.3200 does not, and cannot by
 36    its very nature, respond as state regulation does, to states'  individual  and
 37    unique insurance markets and constituent concerns; and
 38        WHEREAS, S.40/H.R.3200 has the potential to compromise state guaranty fund
 39    coverage,  and  employers  could  end up absorbing losses otherwise covered by
 40    these safety nets for businesses affected by insolvencies; and
 41        WHEREAS, S.40/H.R.3200 would ultimately impose the  costs  of  a  new  and
 42    needless federal bureaucracy upon businesses and the public; and
 43        WHEREAS,  many  state  governments derive general revenue dollars from the
 44    regulation of the business of insurance, including over $14 billion in premium

                                       2

  1    taxes generated in 2006, of which the state of Idaho generated over  $80  mil-
  2    lion; and
  3        WHEREAS, S.40/H.R.3200 does not fully guarantee state premium tax revenues
  4    for a long-term period of time and has the potential to draw premium tax reve-
  5    nue from the states.
  6        NOW,  THEREFORE,  BE IT RESOLVED by the members of the Second Regular Ses-
  7    sion of the Fifty-ninth Idaho Legislature, the Senate and the House of  Repre-
  8    sentatives  concurring  therein, that the Idaho Legislature joins the National
  9    Conference of Insurance Legislators in expressing  its  strong  opposition  to
 10    S.40/H.R.3200  and  any other such federal legislation that would threaten the
 11    power of state legislatures, governors, insurance commissioners and  attorneys
 12    general  to oversee, regulate and investigate the business of insurance and to
 13    protect consumers.
 14        BE IT FURTHER RESOLVED that the Secretary of the Senate  be,  and  she  is
 15    hereby authorized and directed to forward a copy of this Memorial to the Pres-
 16    ident  of  the  Senate and the Speaker of the House of Representatives of Con-
 17    gress, the congressional delegation representing the State  of  Idaho  in  the
 18    Congress  of the United States, to members of the United States Senate Commit-
 19    tee on Banking, Housing and Urban Affairs, and the United States House of Rep-
 20    resentatives Committee on Financial Services.

Statement of Purpose / Fiscal Impact



                       STATEMENT OF PURPOSE

                            RS 18092

The language found here is proposed by NCOIL, the National
Conference of Insurance Legislators who share concerns about the
optional federal charter system currently proposed. This system,
if enacted, would  bifurcate insurance regulation, make national
carriers less responsive to Idaho needs and could threaten state
collection of premium taxes.


                          FISCAL IMPACT

None however passage of federal legislation S40/HR3200 could
threaten the fourth largest revenue source for the State of
Idaho, some $80M in 2006 collections.








Contact
Name: Senator John W Goedde 
Phone: 332-1321


STATEMENT OF PURPOSE/FISCAL NOTE                       SJM 114