Garrett’s Surplus Lines Bill Passes House
September 20, 2009
Scott Garrett (R-NJ) spoke on the floor of the House of Representatives about his legislation, HR 2571, the Nonadmitted and Reinsurance Reform Act of 2009, which passed the House of Representatives by voice vote.
Garrett gave the following remarks on the floor to advocate for his bill:
“Thank you Mr. Speaker.
“I would like to begin by thanking several people who played a significant role in getting us where we are today, starting with the gentleman from Kansas, Mr. Moore, the sponsor of this bill. He has exhibited tremendous leadership and persistence in moving this legislation to the floor and should be commended for his hard work.
“I would also like to congratulate the gentlewoman from Florida, Ms. Brown-Waite, who was the lead Republican on this bill the last 2 Congresses and has worked tirelessly on this important issue. I am pleased to have the opportunity to take up the mantle this year.
“And finally, I would like to thank the National Association of Insurance Commissioners and Dr. Therese Vaughn for their efforts in working closely with all of the interested parties. I believe the inclusive and deliberative process that this legislation has undergone should serve as a model as we continue to work on revamping and modernizing other aspects of our financial regulatory framework.
“Mr. Speaker, H.R. 2571, the Nonadmitted and Reinsurance Reform Act of 2009, will reform and streamline the regulation of the Nonadmitted (or Surplus Lines) Insurance market as well as the Reinsurance market.
“Title I, which addresses the Surplus Lines market, will reduce regulatory overlap and clarify where the appropriate taxing authority lies with each market transaction. It will also establish the NAIC’s eligibility requirements as the standard for participation in the Surplus Lines marketplace. These provisions will increase efficiency, reduce transaction costs and improve access to the entire market for consumers.
“Title II of the legislation addresses several important areas within the Reinsurance market. The bill will create a procedure to establish a single solvency regulator for each reinsurer, eliminate the extraterritorial application of state law with regards to reinsurance, and provide for a more simplified process in determining the credit for reinsurance that companies will receive.
“Both the Surplus Lines and Reinsurance titles are vital to promoting further harmonization for transactions occurring across state lines and eliminating unnecessary red tape which will reduce costs for consumers. In an increasingly complex world, it is essential that consumers and businesses be able to purchase insurance for risks outside of the traditional realm. I believe this legislation will further increase efficiency and reduce costs for these important transactions.
“Similar variations of this legislation have passed in the House the last two Congresses by unanimous votes. It is my hope that this bipartisan bill will once again pass unanimously and I ask all of my colleagues for their support.”