NAIFA GovWatch

Agent Licensing Reform Legislation Reintroduced in House

Issue: Insurance Regulatory Reform

Date: May 21, 2009

Action Taken: Moments ago Representatives David Scott (D-GA) and Randy Neugebauer (R-TX), along with more than 30 of their bipartisan House colleagues, reintroduced the National Association of Registered Agents and Brokers Reform Act, H.R. 2554, for consideration by the 111th Congress.

NAIFA Position: NAIFA worked closely with Reps. Scott and Neugebauer to bring about introduction of NARAB II. We support NARAB II because it would allow producers who are licensed to operate in multiple states to comply with a single set of non resident licensing and continuing education rules.

Background: On March 13, 2008, Rep. David Scott (D-GA) and Rep. Geoff Davis (R-KY) introduced federal legislation to streamline the multi state licensing process for insurance producers. The National Association of Registered Agents and Brokers Reform Act — or “NARAB II” as the bill is informally called — would create an organization whose specific jurisdiction would be the oversight of producer reciprocal licensing and continuing education standards on a national level. The bill was passed in the U.S. House of Representatives on September 17, 2008 but did not see further legislative action before the 110th Congress adjourned in December 2008.

Quick Facts About NARAB II:

It does not create a federal regulator for insurance

Membership in NARAB is optional

The bill does not aim to reduce the standards for agents to be licensed; rather it allows producers who are licensed and operate in multiple states to comply with a single set of non resident licensing and continuing education rules.

Agents that apply for NARAB membership will be required to submit to a criminal background check.

There will be fees for NARAB membership that will be established by the NARAB governing board.

NARAB members would be governed by NARAB’s continuing education requirements and no state other than a producer’s home state could impose CE requirements on NARAB members.

Non-resident states would continue to have the power to discipline NARAB licensed producers and to suspend their licenses.

The NARAB Board must coordinate disciplinary efforts with the states and establish a consumer complaints office.

The NARAB Board can seek a court order if necessary to enforce its disciplinary actions.

The NARAB Board would consist of 11 members that are appointed by the President with the advice and consent of the Senate. Six members of the Board would be state insurance commissioners. The remaining 5 members would be marketplace representatives of producer and carrier groups.

To learn more about NARAB II, visit www.naifa.org/irr

Next Steps: NAIFA will continue to work with Reps. Scott, Neugebauer, and other members of the House Financial Services Committee to shepherd NARAB II legislation through the House this Congress. We will also work to introduce and pass companion legislation in the Senate.

AHIA/ NAIFA Staff Contact: Jill Edwards, Assistant Vice President, Federal Government Relations

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