The threat of federal intervention provided sufficient incentive for the NAIC to adopt the Producer Licensing Model Act
, which was adopted by enough states to avoid the creation of NARAB.
Incoming NAIFA President Cliff Wilson cited such initiatives as working with the NAIC to create and, when possible, implement the Producer Licensing Model Act
, the National Insurance Producer Registry, the Suitability in Annuity Transactions Model Act and the Interstate Compact.
Now, because the attorney general's office, in its settlements with Marsh and Aon, appears to be reinforcing, even expanding, this long-held position of the New York State Insurance Department, and because Marsh and Aon do business nationwide, important precedents are being set with respect to producers who do not have direct contact with the end users of insurance, despite the incorporation in the NAIC Producer Licensing Model Act
of language seemingly exempting wholesale brokers.
In response to the controversy generated by New York Attorney General Eliot Spitzer's investigations into alleged bid rigging and market manipulation by insurance brokers, the National Association of Insurance Commissioners has drafted a compensation disclosure amendment to its Producer Licensing Model Act
. Despite its adoption of the amendment, the NAIC has sent one section back to a task force to be reviewed and possibly reworked.
He said "Florida has enacted licensing reform that in no way resembles the Producer Licensing Model Act
" and California, the largest of states in terms of insurance premiums written, has enacted no licensing reciprocity legislation.
In fact, while more than 40 states had enacted some form of the NAIC's Producer Licensing Model Act
as of mid-June, Allen notes that several states "have enacted new licensing laws that do little or nothing to change barriers for entry for nonresident producers."
Act 580, the Producer Licensing Model Act
, provides for full compliance with the federal Gramm-Leach-Bliley law that requires at least 29 states to enact uniform or reciprocal producer licensing laws by November 2002 or lose their producer licensing authority to the federal government.
Sadly, insurance producers, once again, leave the table without achieving the final step to New York's full adoption of the NAIC's Producer Licensing Model Act
. The bill A.3551, sponsored by Chairman Morelle at the request of the Insurance Department, would have added three new lines of authority, credit, crop and surety.
Another effort at the state level will be the introduction of the Producer Licensing Model Act
, he said.
6 of a proposed amendment to the NAIC's Producer Licensing Model Act
, which would tighten requirements for producers to disclose commissions--including contingent payments--they receive from insurers.
"It is vital Arkansas pass the National Association of Insurance Commissioners Producer Licensing Model Act
," Commissioner Mike Pickens wrote.
What may be surprising, however, is that 15 of the 30 disciplinary actions released in the first week of January 2010 involved a licensee's failure to disclose or failure to report information to the Department as required by the Producer Licensing Model Act
. While some licensees failed to provide truthful responses to a question on a renewal application (such as a prior criminal conviction or a bankruptcy proceeding or an administrative proceeding), the most prevalent failure was to report within 30 days the action taking by another state insurance department.