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ACTION ALERTS
Legislative Alerts!
House Passes Health Reform - Nov. 7, 2009
Action Taken: On November 7, the House of Representatives voted 220 -215 to pass its version of health reform (H.R. 3962). Thirty-nine Democrats voted against and one Republican, Cao of Louisiana, voted in favor of the bill. To see how Members of Congress voted, view the roll call vote here. To see how Members in your state voted, simply click on the “State-by-State” tab.
NAIFA Position: NAIFA President Thomas D. Currey, CLU, ChFC, LUTCF issued the following statement immediately after the vote on Saturday night.
"H.R. 3962 contains many provisions that NAIFA has long supported including affordability credits, wellness and prevention provisions, guaranteed issue and consumer access to professional agent services.
However, there are a number of health reform issues that need further consideration before the bill will meet NAIFA's reform goals, and we are disappointed that the House passed the bill without fully vetting these concerns. In addition to controversial health provisions, we are particularly troubled with the use of health care reform legislation to expand the FTC’s authority over all lines of insurance and to limit the McCarran-Ferguson protection of pro-competitive activities in the medical malpractice and health insurance markets. Excessive authority is unwarranted, and would have negative impact, particularly on property-casualty and life insurers and their consumers.
NAIFA is dismayed by the sweeping changes to the regulation of all lines of insurance in the context of a health reform bill.
We continue to believe that the health care reform challenge can be met by bringing millions of uninsured Americans into the system and reducing the high cost of health care for everyone. We look forward to working with the Senate and the Reconciliation Conferees to address our concerns."
Next Steps: While all eyes will turn to the Senate, don't expect the Senate plan to follow the House on health care overhaul. The House bill will be deemed unacceptable to many in the Senate.
The details of the merged Senate bills will be released after the Congressional Budget Office (CBO) releases its analysis of the merged bills. The Senate bill is expected to be more to our liking in achieving affordable coverage for all Americans. All indicators are that it, too, will have specific authorization for agents to participate in the reformed health system. Currently, it contemplates including a government plan with a state opt-out, but indicators are that that provision will drop out during Senate floor debate.
The Senate process will also differ from the House floor vote which allowed limited amendment opportunities. Once the CBO score is released, the Senate debate is expected to last several weeks. Debate will include many amendments and we expect to have a number of our concerns addressed there, including strengthening the balance between penalty and purchase of insurance.
The Senate floor debate will not begin until after Thanksgiving. If the Senate does pass a bill, it will be different enough from the House bill that a lengthy and contentious conference is probable.
Our current strategy is to support health reform that includes a meaningful, fairly compensated role for agents, no tax on workers based on their employer-provided health insurance, meaningful coverage requirements and no public plan. NAIFA will work to improve our issues in the Senate bill as the initiative moves toward final passage.
What You Can Do: Agents are encouraged to educate their clients and friends and to take advantage of local media opportunities. See below for links.
- Meet with Your Senators over Veteran’s Day Recess.
- Urge your friends and colleagues to have their voices heard.
- Engage the Media Members and their constituents pay close attention to their local media. Make the voice of agent heard by sharing your comments with the media.
- Visit HealthChat to read articles, view videos and learn what others are doing. (Note: Please make sure you are logged into the NAIFA website in order to access HealthChat.)
Contact Your Member of Congress Today!
***IPA Update:*** Nov 9, 2009
You need to contact your Member of Congress today to oppose two sections of the Investor Protection Act of 2009 (H.R. 3817) that could:
(1) Allow the Securities and Exchange Commission to ban registered representatives of broker-dealers from receiving a commission for the sale of variable insurance products or other securities products; and
(2) Expose registered representatives and investment advisers to increased liability for being compensated for providing personalized investment advice
Acting now is critical because the House Financial Services Committee approved the H.R.3817 today and it is scheduled for House floor action as early as December!!!
Ways to Contact Congress:
- Every NAIFA member should take a minute to send the following pre-written letter to your Member of Congress. Simply enter your contact information and press send. If you have additional time, please edit the letter to put a personalized touch on the message. Let's flood Capitol Hill with letters!! Click here to send a letter.
Impact of the H.R. 3817 legislation on NAIFA Members: H.R. 3817 will have huge ramifications for NAIFA members and the way you interact with your clients. This legislation covers disclosures to investors, commission compensation, and harmonized examinations for investment advisers, broker dealers and registered representatives.
*Please note that the Issue Brief can be printed and shared with your Member of Congress.
Click here to access our webinars and PowerPoint presentations on the Investor Protection Act of 2009
!!!November 6, 2009 Health Care Bill!!!
November 6, 2009
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Attention: AllRegistered Representatives of Broker-Dealers
Contact Your Member of Congress Today!
You need to contact your Member of Congress today to oppose two sections of the Investor Protection Act of 2009 (H.R. 3817) that could:
(1) Allow the Securities and Exchange Commission to ban registered representatives of broker-dealers from receiving a commission for the sale of variable insurance products or other securities products; and
(2) Expose registered representatives and investment advisers to increased liability for being compensated for providing
personalized investment advice
Acting now is critical because the House Financial Services Committee approved the H.R.3817 today and it is scheduled for House floor action as early as December!!!
Ways to Contact Congress:
- Select one person to organize a group from your NAIFA local to hold an in-person district meeting with your Member of Congress during the next Congressional recess (dates November 11-13).
- If the Representative is unavailable, request a teleconference with the member of Congress or his/her financial services staff before November 13. Include as many NAIFA members as possible in the teleconference.
- Every NAIFA member should take a minute to send the following pre-written letter to your Member of Congress. Simply enter your contact information and press send. If you have additional time, please edit the letter to put a personalized touch on the message. Let's flood Capitol Hill with letters!! Click here to send a letter.
Impact of the H.R. 3817 legislation on NAIFA Members: H.R. 3817 will have huge ramifications for NAIFA members and the way you interact with your clients. This legislation covers disclosures to investors, commission compensation, and harmonized examinations for investment advisers, broker dealers and registered representatives.
*Please note that the Issue Brief can be printed and shared with your Member of Congress.
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Week of October 26, 2009
Investor Protection Act of 2009 (IPA 2009)
The Investor Protection Act will have huge ramifications for all NAIFA members as well as ANY INSURANCE
& FINANCIAL PROFESSIONAL! Your immediate attention to this legislation is critical.
The House Financial Services Committee is scheduled to vote on amendments to the Act THIS WEEK!
Why Immediate Action is Needed
• Congress will mark up legislation tomorrow that would impose a fiduciary duty on registered reps,
including life insurance agents.
• Life insurance agents cannot have both a fiduciary duty to two parties on opposite sides of the same
transaction-customers who buy insurance and insurers who pay agents based on sales.
• Therefore, this legislation will push customers to fee-based services-even though the vast majority of
Americans don't choose or can't afford the fee-based model.
• At the end of the day, the clients will suffer-there will be less access to varying forms of advice and
product costs will increase.
• The financial plans of 65% of American families include life insurance, whereas only 17% of Americans
employ a written, updated financial plan with a fee-based advisor. We must educate Congress on
the marketplace.
YOUR HELP IS NEEDED!
It is absolutely critical that NAIFA shows a strong grassroots
force to the Members of Congress serving on the House Financial Services Committee.
Be PREPARED for the forthcoming GovAlert on the IPA 2009.
To access the latest legislative and advocacy information and to access the “capwiz” site to locate your local
legislators and assemblymen/women, congressmen/women and senators on both the state and federal level,
Go to the NAIFA NYS website at:
http://naifanys.org/
NAIFA National Briefing Paper
On Thursday, October 1, 2009 Chairman Paul Kanjorski of the House Financial Services Subcommittee and Capital Markets, Insurance, and Government Sponsored Enterprises released a discussion draft of revised legislative proposal, known as the Investor Protection Act. The original draft version of the Investor Protection Act was proposed by the Obama Administration as part of their comprehensive regulatory reform overhaul effort. The House Financial Services Committee is scheduled to consider Chairman Kanjorski’s proposal on Tuesday, October 27, 2009.
Chairman Kanjorski’s draft legislation, like the Administration’s proposal, would impose a fiduciary standard of care on broker-dealers and harmonize the standards applicable to investment advisers and broker-dealers. The call for a harmonized fiduciary standard stems from a January 2008 SEC-commissioned Rand report which found that consumers do not clearly understand the differences between investment advisers and broker-dealers. The Rand report also found that investors are generally happy with their advisers and the services they provide. The latter point is critical to keep in mind as proposals for a uniform standard of care are considered in order that the goal of harmonization does not damage the current, generally successful, nature of existing client-adviser relationships.
This issue is important to NAIFA because nearly three-quarters of NAIFA’s members are registered representatives of broker-dealer firms, and many NAIFA members are registered investment adviser representatives (IAR’s) under a corporate RIA, or have become their own Registered Investment Advisor (RIA); thus the outcome will have a significant impact on the millions of clients we serve.
NAIFA supports the efforts by the Administration and Congress to address consumer confusion about the roles of investment advisers and broker-dealers, and to better protect consumers from bad actors. However, we question whether imposing a new uniform fiduciary standard of care on all financial professionals will stop unscrupulous individuals. In our view, bad actors will continue to violate any standards of care that Congress and/or the SEC puts forth. Instead, NAIFA believes that the best way to help investors is to provide them with a clear and easy to understand disclosure about the respective roles of advisers, the nature of their contractual relationships, and the different products, advice, and services they provide. In our members’ experience, disclosure engages clients in a constructive dialogue about their financial goals and objectives and what they can expect from their financial professional. To that extent, we are encouraged by the provisions of Chairman Kanjorski’s discussion draft that call for such disclosure.
NAIFA has multiple concerns about legislative and regulatory efforts to address the problem by establishing a harmonized fiduciary standard of care for investment advisers and brokerdealers.
We believe this “one size fits all” approach overreaches in addressing the problem of consumer confusion, and fails to recognize the inherent differences in the process of selling advice for a fee as opposed to selling financial products. However, if Congress is going to move to establish a harmonized fiduciary standard of care, we encourage Members of Congress to consider the following important factors to ensure the standard both protects consumers and is practically workable for the financial professionals that serve them:
- The standard must call for clear and easy-to-understand disclosure about the respective roles of financial professionals, the nature of their contractual relationships, and the different financial products and services available, so the investor is in a position to make an informed decision about the products and services offered by the financial professional.
- The standard must preserve the ability of financial professionals to sell only products made available by the company or companies with which they are affiliated and/or with which they have a contractual relationship/agreement.
- The standard must recognize the ability of financial professionals to be fairly compensated without restriction as to the manner or type of compensation arrangements, including, but not limited to commissions or fees. Compliance with a standard of care should not be determined by the manner or type of compensation received by the financial professional, but by the type of product or service provided to the consumer.
Action Taken: On November 7, the House of Representatives voted 220 -215 to pass its version of health reform (H.R. 3962). Thirty-nine Democrats voted against and one Republican, Cao of Louisiana, voted in favor of the bill. To see how Members of Congress voted, view the roll call vote here. To see how Members in your state voted, simply click on the “State-by-State” tab.
NAIFA Position: NAIFA President Thomas D. Currey, CLU, ChFC, LUTCF issued the following statement immediately after the vote on Saturday night.
"H.R. 3962 contains many provisions that NAIFA has long supported including affordability credits, wellness and prevention provisions, guaranteed issue and consumer access to professional agent services.
However, there are a number of health reform issues that need further consideration before the bill will meet NAIFA's reform goals, and we are disappointed that the House passed the bill without fully vetting these concerns. In addition to controversial health provisions, we are particularly troubled with the use of health care reform legislation to expand the FTC’s authority over all lines of insurance and to limit the McCarran-Ferguson protection of pro-competitive activities in the medical malpractice and health insurance markets. Excessive authority is unwarranted, and would have negative impact, particularly on property-casualty and life insurers and their consumers.
NAIFA is dismayed by the sweeping changes to the regulation of all lines of insurance in the context of a health reform bill.
We continue to believe that the health care reform challenge can be met by bringing millions of uninsured Americans into the system and reducing the high cost of health care for everyone. We look forward to working with the Senate and the Reconciliation Conferees to address our concerns."
Next Steps: While all eyes will turn to the Senate, don't expect the Senate plan to follow the House on health care overhaul. The House bill will be deemed unacceptable to many in the Senate.
The details of the merged Senate bills will be released after the Congressional Budget Office (CBO) releases its analysis of the merged bills. The Senate bill is expected to be more to our liking in achieving affordable coverage for all Americans. All indicators are that it, too, will have specific authorization for agents to participate in the reformed health system. Currently, it contemplates including a government plan with a state opt-out, but indicators are that that provision will drop out during Senate floor debate.
The Senate process will also differ from the House floor vote which allowed limited amendment opportunities. Once the CBO score is released, the Senate debate is expected to last several weeks. Debate will include many amendments and we expect to have a number of our concerns addressed there, including strengthening the balance between penalty and purchase of insurance.
The Senate floor debate will not begin until after Thanksgiving. If the Senate does pass a bill, it will be different enough from the House bill that a lengthy and contentious conference is probable.
Our current strategy is to support health reform that includes a meaningful, fairly compensated role for agents, no tax on workers based on their employer-provided health insurance, meaningful coverage requirements and no public plan. NAIFA will work to improve our issues in the Senate bill as the initiative moves toward final passage.
What You Can Do: Agents are encouraged to educate their clients and friends and to take advantage of local media opportunities. See below for links.
- Meet with Your Senators over Veteran’s Day Recess.
- Urge your friends and colleagues to have their voices heard.
- Engage the Media Members and their constituents pay close attention to their local media. Make the voice of agent heard by sharing your comments with the media.
- Visit HealthChat to read articles, view videos and learn what others are doing. (Note: Please make sure you are logged into the NAIFA website in order to access HealthChat.)
Contact Your Member of Congress Today!
***IPA Update:*** Nov 9, 2009
You need to contact your Member of Congress today to oppose two sections of the Investor Protection Act of 2009 (H.R. 3817) that could:
(1) Allow the Securities and Exchange Commission to ban registered representatives of broker-dealers from receiving a commission for the sale of variable insurance products or other securities products; and
(2) Expose registered representatives and investment advisers to increased liability for being compensated for providing personalized investment advice
Acting now is critical because the House Financial Services Committee approved the H.R.3817 today and it is scheduled for House floor action as early as December!!!
Ways to Contact Congress:
- Every NAIFA member should take a minute to send the following pre-written letter to your Member of Congress. Simply enter your contact information and press send. If you have additional time, please edit the letter to put a personalized touch on the message. Let's flood Capitol Hill with letters!! Click here to send a letter.
Impact of the H.R. 3817 legislation on NAIFA Members: H.R. 3817 will have huge ramifications for NAIFA members and the way you interact with your clients. This legislation covers disclosures to investors, commission compensation, and harmonized examinations for investment advisers, broker dealers and registered representatives.
*Please note that the Issue Brief can be printed and shared with your Member of Congress.
Click here to access our webinars and PowerPoint presentations on the Investor Protection Act of 2009
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