08-R073
2008 -- H 7269
Enacted 02/27/08
H O U S E R E S O L U T I O N
OPPOSING THE
AMENDMENT OR REPEAL OF THE MCCARRAN-FERGUSON ACT
Introduced By:
Representatives Kennedy, San Bento, Picard, Williams, and Lewiss
Date Introduced: January
29, 2008
WHEREAS,
The United States Congress, in 1945, passed the McCarran-Ferguson Act,
granting
insurers a limited antitrust exemption and providing states with the sole
authority to
regulate
the business of insurance; and
WHEREAS,
This authority has led to the successful promotion of a strong, efficient,
consumer-based
system of insurance oversight; and
WHEREAS,
State legislatures, state regulators, and state attorneys general have proven
responsive
to the needs of their constituents and the need for insurance products and
regulation
that
suits their states’ unique market demands; and
WHEREAS,
The states, along with the National Conference of Insurance Legislators
(NCOIL)
and other groups, continue to address issues of uniformity and modernization by
enacting
legislation that streamlines and strengthens regulation throughout the states,
in response
to
an increasingly competitive and global insurance market; and
WHEREAS,
The limited antitrust exemption granted under the McCarran-Ferguson Act
is
not a loophole through which insurers can avoid prosecution for antitrust
violations such as
boycotts,
intimidation, or coercion, nor does it limit the abilities of state attorneys
general to
prosecute
crimes under existing state antitrust laws; and
WHEREAS,
The McCarran-Ferguson Act’s limited antitrust exemption fosters
competition
by granting insurers the ability to share loss history and other information
and
ensuring
that smaller and more regional insurers are able to compete with large insurers
that are
less
dependant on industry-wide data; and
WHEREAS,
The “Insurance Industry Competition Act” (S. 618/H.R. 1081) would
repeal
the limited antitrust exemption granted under the McCarran-Ferguson Act; apply
to the
business
of insurance consumer-protection provisions of the Federal Trade Commission Act
to
the
extent that they are not regulated by state law; and authorize the Federal
Trade Commission
and
the United States Justice Department to oversee the business of insurance; and
WHEREAS,
Subjecting consumers and the insurance industry to the complicated and
very
likely contradictory system of state and federal regulation contemplated by S.
618/H.R. 1081
would
lead to confusion that would destabilize insurance markets that rely on
predictability to
gauge
risks and price products, as well as lead to years of costly litigation; and
WHEREAS,
Any changes to the limited antitrust exemption, such as those envisioned by
S.
618/H.R. 1081, would not lower insurance costs for consumers, but, in fact,
could have the
opposite
effect should smaller insurers be driven from the market, particularly in
communities
with
limited availability and affordability of coverage; and
WHEREAS,
Any amendment to the McCarran-Ferguson Act, including S. 618/H.R.
1081,
could call into question the operation of state guaranty funds and residual
markets
mechanisms
that, respectively, protect claimants whose insurance companies have gone
insolvent
and
ensure that insurance is available to all; now, therefore be it
RESOLVED,
That this House of Representatives of the State of Rhode Island and
Providence
Plantations hereby joins the National Conference of Insurance Legislators in
opposing
passage
of S. 618/H.R. 1081 on the grounds that it misinterprets the role of states in
enforcing
antitrust
protections and would jeopardize insurer practices that promote available and
affordable
coverage;
expose insurance markets to uncertainty and litigation; and create an
environment that
inadvertently
disadvantages consumers most in need; and be it further
RESOLVED,
That the Secretary of State be and he hereby is authorized and directed to
transmit
duly certified copies of this resolution to the members of the Rhode Island
Congressional
Delegation,
members of the United States House of Representatives Committee on the
Judiciary,
and
members of the United States Senate Committee on the Judiciary.
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LC00968
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