Sept. 16 - Consumer Groups Oppose Trade/ Preemption Provisions of Insurance Bill

Public Citizen, U.S. PIRG, Center for Economic Justice, Consumer Federation of California joined by an array of state officials opposing H.R. 5840

Posted: 09/16/2008 Read the full consumer letter (PDF) Learn more about trade and state and local governance State and local coverage at Eyes On Trade

Public Citizen, U.S. PIRG, Center for Economic Justice and Consumer Federation of California yesterday released a statement to Congress about H.R. 5840:

Dear Representative,

We are writing to you today to ask you to oppose a financial services bill, HR 5840 that would allow the Department of the Treasury to interpret or enter into international agreements regarding insurance policy and regulation, and then preempt state insurance laws and regulations that Treasury believes to be in contradiction of such international agreements. HR 5840 (the "Insurance Information Act of 2008") is now listed on the suspension calendar for Tuesday, September 16.

This bill should not have been placed on the suspension calendar. Many members of Congress remain unaware of the bill’s negative implications for state consumer protections – much less that the bill would set a bad precedent by delegating new authority to an executive agency to become international trade and commercial agreement “enforcer” against U.S. state consumer regulatory policy.

Among the requirements against which this bill would allow Treasury to measure U.S. state insurance policy are those that would be promulgated under future World Trade Organization (WTO) General Agreement on Trade in Services (GATS) pacts (one is currently under negotiation) and future "Free Trade Agreements" (FTAs) and through the industry-dominated TransAtlantic Dialogue process. The existing international commercial agreements that cover insurance, such as those related to the WTO and the FTAs, contain many restrictions on common state insurance regulations that provide essential consumer protections. There is no basis to believe that future international commercial agreements – to which this bill applies – will reverse this pattern of such pacts imposing limits on legitimate domestic regulatory authority.

Click here to continue reading the full letter (PDF).

Also view letters (all PDF downloads) from various state officials and consumer groups opposing or expressing concern about these provisions of H.R. 5840:

• National Conference of State Legislatures
• National Conference of Insurance Legislators
• National Association of Professional Insurance Agents
• Maine Governor John Baldacci
• Maine Superintendent of Insurance and Attorney General
• Nevada Commissioner of Insurance
• Ohio Department of Insurance
• Vermont Department of Banking, Insurance Securities and Health Care Administration
• California Nurses Association and National Nurses Organizing Committee
• Consumer Watchdog
• Washington Fair Trade Coalition

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