Life Insurance Quote Overview

As the House Financial Services Committee prepares to mark-up insurance deregulation legislation, more than three dozen of the nation's leading consumer, civil rights, community and labor organizations have sharply criticized the proposal for sweeping away important consumer protections.

At issue is a discussion draft put together by Reps. Michael G. Oxley (R-OH) and Richard H. Baker (R-LA). Called the State Modernization and Regulatory Transparency Act (SMART), it would supposedly iron out inconsistencies in state regulation of insurance companies.

But an alliance of national and state organizations disagrees.

"The SMART Act would do a lot of dumb things, like gutting important state consumer protections at the very time that New York Attorney General Spitzer's investigation has demonstrated the need for greater oversight of the insurance industry," said J. Robert Hunter, Director of Insurance for the Consumers Federation of America.

"This would leave millions of consumers vulnerable to price gouging, as well as abusive and discriminatory insurance classification practices," he said.

"The NAACP is concerned that this proposal will allow a return to the kind of insurance redlining that has severely harmed minority and lower income consumers in past years," said Hilary O. Shelton, Director of the NAACP Washington Bureau.

"The poorly-named SMART draft would lift current insurance rate restrictions and ban prohibitions on setting rates by territory that are well established and are proven tools in the fight against discrimination."

"This proposal's anti-consumer bias is made clear by the fact that it creates two federal offices to represent insurer interests but does nothing to provide better representation for America's beleaguered insurance consumers," said Norma Garcia, Senior Attorney with Consumers Union.

"The draft is a veritable 'wish list' of items requested by insurers with absolutely no protections offered for consumers," Garcia said. "It does nothing to increase competition in the insurance industry, such as eliminating the antitrust exemption that insurers enjoy under federal law, or lifting Congressional restrictions that prevent the Federal Trade Commission from investigating deceptive or fraudulent acts by insurers.

The National Conference of Insurance Legislators (NCOIL) and National Association of Insurance Commissioners, have also expressed serious concerns about the draft.

Referred from: (http://www.consumeraffairs.com)