As the Obama administration works to put the finishing touches on plans for a major revamp of financial services regulations, a who’s who of the sector’s top lobbyists and high-level representatives are making the rounds this week at Treasury and the White House.
Today at 5 p.m., a group of insurance industry trade association chiefs plans to meet with top Treasury officials at the Old Executive Office Building. That meeting comes on the heels of a session on Wednesday with representatives from insurance and financial companies such as Allstate, the Chicago Board of Trade, Nasdaq, Prudential, Travelers, UBS and Wells Fargo, among others.
“It was a good, healthy discussion,” one person familiar with the Wednesday meeting said on condition of anonymity. On the agenda, this financial services source added, was the controversial and long-standing issue of whether the insurance industry requires federal regulation.
That topic will also take center stage at today’s meeting, which one insurance industry source said marks the first meeting between the administration and the industry focused solely on insurance regulation in financial services reform.
Don’t expect the insurance trade associations to speak with one voice; they do not see eye to eye on whether the industry, which is currently regulated at the state level, should answer to a federal regulator.
“We’re not against some mechanism to address systemic risk,” said Terri Vaughan, CEO of the National Association of Insurance Commissioners. “We do think that maintaining functional regulation, having the expertise of the insurance regulators and the banking regulators, is a good idea.
“Whatever system is created for promoting financial stability should be one that is collaborative, that brings all the regulators to the table and fosters good communications between all of them.”
Marguerite Tortorello, senior vice president of public affairs for the Property Casualty Insurers Association of America, said her group is not advocating for a federal regulator.
“We wouldn’t want to sweep everybody in, including those [businesses] that are healthy,” she said, adding that it was important to assess first who was inherently at risk.
Several insurance industry honchos are expected to attend today’s meeting, including Leigh Ann Pusey, president and CEO of the American Insurance Association; Cliff Wilson, president of the National Association of Insurance and Financial Advisors; Ken Crerar, president of the Council of Insurance Agents & Brokers; Steve Bartlett, CEO and president of the Financial Services Roundtable; Vaughan of the National Association of Insurance Commissioners; and Ben McKay, senior vice president of federal government affairs for the Property Casualty Insurers Association of America.
Representatives from the Independent Insurance Agents & Brokers of America, American Council of Life Insurers and National Association of Mutual Insurance Cos. are also expected to attend.
According to the meeting’s invitation, Diana Farrell, deputy director of the National Economic Council, and Michael Barr, Treasury’s assistant secretary for financial institutions, will be present at the session.
While PCI and NAIC are among those who have expressed concerns about federal regulation of insurance, groups such as ACLI, AIA and the Financial Services Roundtable are advocating for a federal regulator.
“It’s going to be a dialogue,” said Lee Allen, a spokesman for the NAIFA. “We will represent the Main Street perspective of more than 200,000 life insurance agents and financial advisers.”
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