Life insurance brokerage agencies could save up to $377 million annually in agent licensing costs if Congress were to adopt legislation.
Life insurance brokerage agencies could save up to $377 million annually in agent licensing costs if Congress were to adopt legislation allowing the industry to choose a single federal regulator over state-by-state regulation.
That's according to a study released today by the American Council of Life Insurers in Washington and the National Association of Independent Life Brokerage Agencies in Fairfax, Va.
The study, titled “The Optional Federal Charter: Implications for Life Insurance Producers,” was authored by Temple University Business School associate professor Laureen Regan.
Life insurance brokerage agencies spend an average of $12,600 and 347 hours of staff time annually on compliance costs, according to NAILBA chairman John Felton.
The industry called for passage of the National Insurance Act legislation that has been introduced in both houses of Congress by Democratic and Republican sponsors, saying cost savings would be passed on to consumers in lower premiums.
“With our current system, individuals with the exact same needs cannot gain access to the same life insurance protection, simply because of geography,” said Mr. Felton in a press release.
An earlier study by University of Georgia professor Steven Pottier found that life insurance manufacturers could save up to $5.7 billion annually in compliance costs with a federal charter, said ACLI chief executive and president Frank Keating in the release.
“Now Professor Regan’s analysis shows that life insurance producers would also realize substantial savings.”
