Industry hopes for a streamlined broker licensing process took a major hit Tuesday when the Senate adjourned without passing legislation that aimed to ease the ability of brokers to sell insurance in states across the U.S.
The Senate convened without passing S. 2244, the Terrorism Risk Insurance Program Reauthorization Act of 2014. Attached to the bill was a provision that would have created a National Association of Registered Agents and Brokers (NARAB II), a federal clearinghouse that would cut through the red tape of state-by-state broker and agent licensing and allow for brokers to sell insurance in states across the U.S.
Earlier this month the House, in a 417-7 vote passed the legislation.
See related: House passes NARAB II broker licensing bill
Benefit industry stakeholders have been quick to condemn the Senates failure to reauthorize the TRIA legislation.
With more than a week before Christmas, we are profoundly disappointed in the Senates premature decision to leave town late last night without extending the Terrorism Risk Insurance Act which provides vital protection for the U.S. economy, says Robert Rusbuldt, president & CEO of the Independent Insurance Agents & Brokers of America (IIABA or the Big I).
The Senates inaction is particularly galling in light of the 4177 vote in the House last week on this exact same legislation, he adds.
Leigh Ann Pusey, president and CEO of the American Insurance Association agrees, saying the association is incredibly disappointed that the Senate failed to pass the House-approved six-year TRIA reauthorization bill prior to adjourning. By letting TRIA lapse on Jan. 1, 2015, Congress has failed to protect taxpayers and the economy.
As if this werent bad enough, thousands of small business owners and their customers are waking up this morning with coal in their stockings after somehow NARAB II, agent licensing reform that has already passed both chambers in different bills, was also left on the cutting room floor, says Rusbuldt. We urge Congress to pass both common-sense, bipartisan pieces of legislation as soon as they convene for the 114th Congress early next year.
The National Association of Insurance and Financial Advisors had actively lobbied legislators for the bills passage.
NARAB II is a top priority for NAIFA, says NAIFA President Juli McNeely. The legislation benefits consumers as well by allowing them to maintain their preferred insurance agent or broker should they move to or from our state.
Insurance agents and brokers have been waiting for years to bring meaningful reciprocity, like NARAB II, to the agent licensing process, she says.
See related story: NARAB II passage questionable
NARAB II would streamline the non-resident producer licensing process but preserve the states ability to protect consumers it does not create a federal regulator for insurance and the states would retain their regulatory authority over consumer protection, market conduct and unfair trade practices, according to a brief on the bill by the National Association of Insurance Commissioners. The states also would retain their rights over resident licensing, as well as supervision, discipline and the establishment of licensing fees for insurance producers, NAIC adds.
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