The Insurance Information Act of 2008 aims to eliminate competitive disadvantages prevalent among U.S. insurance companies and to modernize domestic insurance regulation. Specifically, the measure would consolidate the more than 50 state regulators into a united and consistent group to appeal to foreign firms and create global competition among insurance carriers.
The Automotive Service Association (ASA) supports federal regulation of the insurance industry, and HR 5840 is a key step toward achieving that goal, according to Bob Redding, ASA’s Washington, D.C. representative.
“This bill is a long way from the federal regulation of the insurance industry. It does continue the process to get to federal regulation,” Redding says, which presents the possibility that eventually steering and other concerns would be addressed at the national level.
“It is very difficult for the collision repair industry to address insurer-repairer issues in 50 states,” Redding says. “The lack of unity and resources prevent consistent resolution of issues of importance to repairers. Federal regulation will provide a greater opportunity for repairers to address insurer-repairer concerns.”
It is most likely any action on major insurance reform will not occur until 2009. “This is a first step toward a much larger debate on insurance reform we will see in the next Congress. In general, consumers and collision repairers will be better protected in a federal regulatory system versus a state system with regard to auto insurance,” Redding says. “If the U.S. Congress fails to address the insurance regulatory issue, continued state regulation could prevent any degree of national insurer-consumer-repairer property and casualty reform.”