The U.S. Senate today passed Senator Jon Tester's bipartisan bill to streamline the insurance licensing system and increase consumer protections.
Tester's bill, the National Association of Registered Agents and Brokers Act (NARAB), will create a non-profit membership organization to streamline the licensing process for insurance agents and brokers operating outside of their home states. Creating a one-stop shop for licensing with a single standard will increase competition in the insurance market while improving overall market supervision.
"Membership in NARAB will streamline the licensing process for agents and brokers, enabling them to be licensed once under a single standard, saving time and money while fully preserving the ability of states to regulate their insurance markets," said Tester, a member of the Senate Banking Committee. "This common-sense legislation is supported by the insurance industry and state regulators and will set rigorous professional and consumer protection standards. I look forward to the House of Representatives passing the bill and the President signing into law."
NARAB was first recommended by the Gramm-Leach-Bliley financial reform legislation in 1999, but was never instituted. Tester's bipartisan bill will formally create NARAB as a non-profit, independent board comprised of state insurance commissioners and insurance market representatives.
After passing background checks in their home states, insurance agents can apply for NARAB membership, allowing them to sell insurance in other states. The bill includes provisions to ensure transparency and consumer protection while also empowering NARAB to levy disciplinary measures on agents who do not adhere to board guidelines.
The House of Representatives has twice passed similar legislation in previous Congresses.
Tester's bill, which was co-sponsored by Senator Mike Johanns (R-Neb.), was included in the Flood Insurance Bill. The Senate passed the flood insurance bill today by a vote of 67 to 32.