Oh man! This is news!!!

Federal Oxley-Baker Bill Would Require Competitive Rating and Uniform Regulation by States August 24, 2004 Sweeping legislation being drafted by federal lawmakers would end state approval of insurance rates and require all states to adopt competitive rating for most types of insurance. Advertisement States would have to stop requiring approval or prior review of rates and comply with this new system of nationwide competitive pricing within two years of enactment of the legislation. While the legislation would require states to modify insurance laws, it stops short of creating a federal insurance regulator or a federal charter option as sought by some insurance companies. ...... I have tried to get a copy of the draft of this. The National Association of Mutual Insurance Companies had it for its members last Friday (but I am not a member). A colleague told me what was in the draft on Monday, but since I hadn't seen the draft, I didn't want to say anything. This is big, big news. Price deregulation in auto and homeowners insurance as well as workers compensation will change a number so state's practices. As I have mentioned previously New Jersey has recently deregulated and Massachusetts gave it the old college try and punted on auto regulation reform. However, just last year, Texas started regulating insurance sold by unregulated county mutual companies. California engages in a style of utility regulation for auto prices and Florida really restricts homeowners insurance prices. This is a big change for the states. The reaction from the states will be quite interesting. For a nice treatment of auto insurance regulation, deregulation and reform see this fantastic book from Brookings-AEI. Brookings charges about $20 for it, but you can download it for free. The chapter on South Carolina is especially moving. UPDATE: Medical Malpractice price regulation will not be pre-empted by the federal legislation. I guess the argument will be that this insurance is so tied to the health cares system/health care policy of the state, that the feds shouldn't preempt regulation of prices. However title and credit insurance, as well as mortgage insurance, are also exempted from preemption. I do not think one can make the same types of arguments about the importance to state policy for title, mortgage, and credit insurance. However, these are esoteric lines of insurance and only about three people in each state understand what is going on in these markets anyway. UPDATE UPDATE: NAMIC's comments.