May 15, 2017
Stuart Henderson Testifies at U.S. Senate Committee Hearing on U.S.—E.U. Covered Agreement
(Minneapolis, Minn.) On Tuesday, May 2, Western National Insurance Group President and Chief Executive Officer Stuart Henderson testified before the United States Senate Committee on Banking, Housing, and Urban Affairs at a hearing on the United States—European Covered Agreement. Henderson, who spoke on behalf of the National Association of Mutual Insurance Companies (NAMIC), was among five industry experts invited to make statements and answer questions on the merits and impacts of the U.S.—E.U. Covered Agreement.
The U.S.—E.U. Covered Agreement is a draft agreement between the United States and the European Union that sets new standards on reinsurance, group supervision, and the exchange of insurance information between regulators. However, NAMIC and other industry groups have expressed concern that the agreement in its current form will competitively disadvantage U.S. companies compared to E.U. insurers and reinsurers. Among the reasons for concern are the lack of guaranteed collateral from E.U. reinsurers, the fact that the agreement will lead to federal pre-emption of state laws, and the lack of guarantees from the E.U. regarding continued recognition of the U.S. regulatory structure. NAMIC, in its official position, asks that Congress either further clarify points of the agreement, or renegotiate the whole agreement.
At the May 2 hearing, Henderson spoke in opposition to the agreement. “The appropriate response to this would be for our federal government to strenuously object and demand the mutual recognition of our system of insurance regulation,” said Henderson. “Instead, they have attempted to solve this narrow problem, invented by the E.U., and in the process created a whole new set of problems.” Henderson said that U.S. negotiators have only succeeded in creating more uncertainty for U.S. insurers with this agreement, stating that “uncertainty is the enemy of business—and of good government.”
At the moment, the U.S.—E.U. Covered Agreement continues to sit with Congress, unsigned, even though the 90-day mandated layover period for reviewing the document has passed. It is uncertain whether or not the agreement will be signed by the U.S. and so entered into force.
Western National Insurance, headquartered in Edina, Minn., is a super-regional group of property-and-casualty insurance companies providing personal and commercial coverage in 20 states across the Midwestern and Western U.S. as well as in Alaska; and surety bonds in 32 states. The Group writes over $631 million in Direct Premium through eight active insurance companies—Western National Mutual Insurance Company, Western National Assurance Company, Pioneer Specialty Insurance Company, Western Home Insurance Company, Arizona Auto Insurance Company, Umialik Insurance Company, American Freedom Insurance Company, and Nevada General Insurance Company—and through one affiliate, Michigan Millers Mutual Insurance Company. All of the Group’s products are sold exclusively through professional Independent Insurance Agents.
For further information, please contact:
Steve Norman, CPCU, M.A., AIT
Assistant Vice President – Communications
(952) 921-5680 or (800) 862-6070 Ext. 7680