Some insurance groups fight Merkley amendment

Several large insurance trade associations are fighting legislation backed by Sen. Jeff Merkley (D-Ore.) that aims to ensure strong power for states on insurance matters.

Merkley sponsored his amendment to the Wall Street overhaul bill as an effort to prevent the Treasury Department from preempting state regulations. The insurance market is regulated primarily in states. The Wall Street bill sets up a new federal Office of National Insurance (ONI) that would monitor the industry and have a say on international insurance agreements.

It is Treasury's power over those international agreements that has split consumer advocacy groups and some property and casualty insurers from parts of the financial industry that support greater federal oversight on insurers. The National Association of Insurance Commissioners (NAIC) is among those supporting the Merkley amendment. The Hill wrote about the Merkley amendment here.

Eight large insurance trade associations said Wednesday they opposed the Merkley amendment.

"Adoption of Senator Merkley’s amendment, while well-intentioned, will undercut that goal and impair the ability of the United States to engage on important and pressing insurance regulatory matters," the associations wrote.

The groups include: American Insurance Association, The Financial Services Roundtable, The Council of Insurance Agents & Brokers, Association of Bermuda Insurers & Reinsurers, American Bankers Insurance Association, Risk and Insurance Management Society, Inc., American Council of Life Insurers and Reinsurance Association of America.