U.S. Sens. Mike Johanns (R-Neb.) and Jon Tester (D-Mont.) today released the following statements after their National Association of Registered Agents and Brokers (NARAB)Reform Act of 2013 passed the Senate Banking Committee:
Johanns said, "This bill is a win for consumers. Increasing competition and lowering compliance costs gives families additional and affordable options when shopping for insurance policies that best meet their needs. This bill also helps streamline licensing requirements for local insurance agents while maintaining the safeguards offered through state-regulated insurance markets. I'm glad the committee advanced our legislation and I look forward to it being taken up by the full Senate."
Tester said, "Today's vote is an important step forward as we improve competition in the insurance market and provide consumers with a better product at a lower price. This bill streamlines the licensing of registered agents and brokers while maintaining strong, state regulation of the insurance industry and protecting the ability of state insurance regulators to regulate insurance markets and protect consumers. I look forward to continuing to work with Senator Johanns, state insurance regulators, and the insurance industry to get this bill across the finish line and signed into law."
Tester and Johanns' legislation aims to increase insurance market options for consumers and reduce insurance costs by creating a non-profit membership organization (NARAB) comprised of state insurance commissioners and insurance market representatives. The board will approve insurance agents and brokers to work outside of their home states, increasing consumer choice and lowering insurance rates.
NARAB was first recommended by the Gramm-Leach-Bliley financial reform legislation in 1999, but it was never instituted. The Senators' bipartisan legislation would formally create NARAB as an independent board. In order to apply for NARAB membership, agents and brokers must pass a background check.
Tester and Johanns' 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.