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Alaska becomes the decisive state for interstate compact.

More than half the states now have signed the Interstate Insurance Product Regulation Compact, bringing to fruition a four-year project by state regulators to establish a national clearinghouse for life insurance product standards.

The compact received its decisive signature when Gov. Frank Murkowski made Alaska the 26th state to join the compact. Parties to the interstate compact agree to determine and adopt uniform standards for review and approval of life, annuities, disability income and long-term-care products.

The American Council of Life Insurers welcomed the news. In a statement, ACLI President Frank Keating said the group looked to the compact as "part of our comprehensive effort to achieve a modern, efficient regulatory system that will benefit consumers and companies alike."

"While ACLI continues to support a dual chartering system of regulation for life insurance, we recognize that many insurers will opt to remain state regulated.

The National Association of Insurance Commissioners established the compact in 2002 with an operational goal of either 26 states or enough states to represent 40 of the premium volume in the United States to put the pact in place. Ohio became the 25th state to join the compact with the May 12 signature of Gov. Robert Taft. With Alaska and Ohio on board, the 26 compact states now represent 39% of premium volume, according to the NAIC.

With these additions in place, the NAIC said its Interstate Insurance Product Regulation Commission would look to form an initial management committee to implement the compact among signatory states. In June the commission determined its headquarters will be in the District of Columbia and its initial leader will be Pennsylvania Commissioner Diane Koken. Maine Insurance Superintendent Alessandro Iuppa will head a committee that will screen candidates for the compact's executive director.

The commission could welcome a 27th member soon, as the Minnesota Legislature has sent a bill adopting the compact to Gov. Tim Pawlenty. Were Minnesota included, the compact states would represent 42% of premium volume, the NAIC said.
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Comment:Alaska becomes the decisive state for interstate compact.
Author:Lehmann, R.J.
Publication:Best's Review
Geographic Code:1U9AK
Date:Jul 1, 2006
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