Skip Ribbon Commands
Skip to main content
Nov 08
Big “I” Government Affairs November 2023 Update

BigI-GovernmentAffairsUpdate.jpgListen to this article here!​

To keep you informed of Big I government affairs advocacy, your association has summarized what the Big I National Government Affairs team has been working on. While not comprehensive, these updates will highlight some of the timeliest issues. This is all to better tell our advocacy story, and what the Big I is doing daily to deliver for the IA system.  

New Speaker of the House  

The U.S. House of Representatives was ground to a halt legislatively for much of October due to the removal of then Speaker Kevin McCarthy on October 3. After nominating and rejecting three potential replacements, the Republican conference settled on current Speaker Mike Johnson and confirmed him by a vote of 220-209 on October 25, ending a 22-day period without a speaker. Prior to becoming Speaker, Johnson served as House Republican Conference vice chairman and is also a former chairman of the Republican Study Committee, the largest conservative caucus in the House. The Big I has a good working relationship with Speaker Johnson and his staff, as well as the rest of the House Republican leadership, which remains intact.  

Government Funding and the National Flood Insurance Program  

On September 30, Congress overwhelmingly passed a continuing resolution to keep the federal government funded at fiscal year 2023 levels through November 17, and in doing so reauthorized the National Flood Insurance Program for that same period. The resolution was passed to give the House and Senate more time to complete their work on twelve appropriations bills that must be passed to fully fund the federal government. To date, the House has passed six of these bills, and the Senate has passed three. With the November 17 deadline quickly approaching, both sides agree that another resolution is likely needed to avoid a partial shutdown of the federal government. Assuming it can get done, that CR will likely go to mid-December (the Senate preference) or January 15 (the House preference). Either way, it would provide another short-term reauthorization of the National Flood Insurance Program for that same period.  

The Farm Bill  

Speaker Johnson has publicly stated that he would like to pass a new five-year Farm Bill after the House wraps up its appropriations work. House and Senate Agriculture Committee leaders acknowledge that an extension of the current Farm Bill will be necessary, with passage of the new Farm Bill in 2024. We anticipate several bills to be introduced in the coming months that aim to harm the Federal Crop Insurance Program. When that happens, we will be activating our grassroots to defeat those bills, as we have done in the past. It’s important to note that the new House Speaker has been supportive of the Federal Crop Insurance Program in the past.  

Hearing on Insurance Market Crisis  

Last week, the U.S. House Financial Services Subcommittee on Housing and Insurance held a hearing entitled “The Factors Influencing the High Cost of Insurance for Consumers.” The hearing, which was originally scheduled for October 24, focused on insurance markets, particularly recent developments that have led to higher costs and lower availability for property and casualty insurance. The Big I submitted written testimony that can be found on the national association’s website. The testimony highlights a variety of issues and concerns from an agent's perspective and offers some potential solutions to alleviate pressure on the market. Those include fostering productive state regulatory environments, cracking down on lawsuit abuse, increasing risk mitigation efforts, considering a narrow federal reinsurance backstop, and increasing consumer transparency. One of the main themes during the hearing was the importance of the state based regulatory system and affirming support for the McCarran-Ferguson Act. Several members of Congress voiced concerns about the Federal Insurance Office and its attempt to become more activist under the current Administration. That activism was clearly on display this week as FIO announced it will move forward with a proposal to collect data from property insurers on climate risks. The hearing also examined H.R. 5535, the Insurance Data Protection Act, which would restrict the ability of FIO and other financial regulators to collect data directly from insurance companies via subpoena.  

Proposed Fiduciary Rule  

On October 31, the Department of Labor released a proposed rule defining who investment advice fiduciaries are for purposes of the ERISA. It also released proposed amendments to class prohibited transaction exemptions for investment advice fiduciaries. The rule is yet to be published in the federal register, but the Department of Labor did release a fact sheet on the proposals. Once published there will be a 60-day public comment period. The Big I will be working with other interested parties to delay this comment period, and subsequently voice concerns with the proposals.  

Corporate Transparency Act  

We have heard from a number of agents asking for more information on the Corporate Transparency Act and what, if anything, is required for them to be compliant when it goes into effect on January 1, 2024. Many small businesses in the United States will have to report information about their beneficial owners, essentially the individuals who ultimately own or control the business. They will have to report the information to the Financial Crimes Enforcement Network (FinCEN for short), a bureau of the U.S. Department of the Treasury. As originally crafted, insurance agents were included in this reporting requirement. However, the Big “I" was successful in securing an exemption for independent agents and brokers by successfully arguing that insurance producers already provide this beneficial ownership information to state regulators and that the additional burden of providing it to the federal government would be duplicative and unnecessary. The Big “I" was the only producer group that advocated on behalf of agents and brokers to exclude them from this new onerous requirement. When FinCEN released their final rule, they adopted the insurance-producer exemption, and specifically noted that they were persuaded by the argument that the Big “I” made.  

Tax Reform  

Here’s a quick update on the Main Street Tax Certainty Act, which would make permanent the 20% small business tax deduction, also known as section 199A of the tax code, before it expires at the end of 2025. The Big I has been working hard to increase the number of cosponsors in both chambers of Congress. To date, we have up to 150 cosponsors in the House and 28 cosponsors in the Senate. Very few bills in Congress have more than 100 cosponsors so this is a testament to the momentum that is building to address this issue.  

NAIC to Consider Public Adjuster Issues and Revisions to Its Model Law  

The National Association of Insurance Commissioners recently unveiled proposed amendments to its Public Adjuster Licensing Model Act that are intended to bolster the requirements and standards that apply to public adjusters. The initial draft focuses on four items: (1) unlicensed public adjusters, (2) contractors who act as public adjusters in connection with the same claim, (3) inappropriate assignment of benefit rights, and (4) fees charged by public adjusters. The NAIC is seeking input on this initial draft, and anyone with feedback and/or suggestions is encouraged to contact Wes Bissett at the National Big I.

Comments

There are no comments for this post.