Arizona Insurance

How odd for a time with the manipulation of the apparatus of regulation of the insurance industry, one of the most stable in all sectors of wippend finance.

Is not the US Treasury Department have enough in mind, without the modest success of umstülpend system of public regulation, which has existed for six decades?

There is no systemic problem in the safety and soundness of the insurer. And consumers are generally well served by the State responsible for price controls and efforts to support forms clear and fair.

While a strong argument can be made that the supervision of the Confederation is a regulatory model for the improvement of the insurance industry that in a global economy, Treasury Secretary Henry M. Paulson Jr. Goes beyond any harm. It proposes the establishment of a federal system operate down low, that consumers and the risk of a serious and unnecessary Backlash.

Under Paulson’s plan, damage and accidents insurers as The Hartford and Travelers and major life insurers such as ING gap would be free to public regulation - and most of the pricing policies and monitoring of the form is consistent with it - for a charter and Lockerere Federal Regulations.

Do you want to get in the choice of their system: the state or federal level. Does your state regulatory authorities too difficult for you? Simply log to a federal charter. Does your state regulatory authorities simple? Stay.

Damage giant State Farm, a vertigo proponents of the option of federal regulation, said the insurance industry is “ideal for competitive market forces to determine the conditions and prices of products, it offers the public.”

Whoa! Let us not forget that insurers have advantages over other companies, which is actually operating and free markets.

Consumers and businesses are often required to buy their products. If you wish, you need auto insurance. If you want a home mortgages, homeowners need insurance. Companies must buy coverage for workers’ compensation. Insurers, on the other hand, it is clear opposition to a potential customer for a variety of reasons. And insurance companies are often complex and difficult to compare, without active support regulation.

And what other industries, competitive pricing, an explicit exception to protect from the Confederation of agreements?

This is not a surprise, consumers, by an overwhelming majority against the supporters Paulson’s optional insurance settlement of Confederation. They fear the leak, insurers countries with the harshest, most pro-Consumer rules and regs. Some say, Paulsen, setting up a bidding war for market share between the federal and regulatory authorities in the country - on the one hand the regime schonendste would save, most businesses.

Connecticut Attorney General Richard Blumenthal swore, all efforts to combat the reduction or prejudge the State authority in the insurance sector. “The federal government has failed miserably and inspection of the bank should be sceptical about the proposals of the Confederation chartered insurance, Blumenthal said in a written statement.

While he has the right, his argument is a little crosswind. Swiss Federal Banking Commission, the regulation is not always the perpetrator. At the saving and credit, the crisis of the late 1980’s, for example, to leave the door to the worst abuses of the state was released by the laws in California, Arizona, Texas and Florida.

This is not a crazy idea, the search for appropriate ways of modernization of insurance supervision in a global economy growing. Forcing national and international companies, in order to comply with the characteristics of the state, 50 departments are not very effective.

But Paulson is handy with straws of his “Rules of the Confederation lite” for insurers. Fortunately, a good piece of his package of revised financial situation - including the option of federally chartered - is not subject to approval by Congress to gain. Good thing.