A 1,0 0 0-Foot View of Legislative Advocacy By John S av a nt , IA & B G ove r n m ent A f fa i r s D i re c tor
With a constant presence in the state capitols, IA&B works daily to monitor legislation and regulations that affect independent agents, and to advance laws and regulations that benefit independent insurance agencies. Here’s how we do it....
Direct Lobbying: Your Insurance Against Bad Legislation
that would have been impossible for agents and carriers to adhere to without violating other state and federal laws, but the legislative session ended before the bill saw a final vote of passage.
Imagine if the laws regulating nuclear power plants were written without the input of nuclear engineers. To say the least, the results would be disastrous. The same can also be true of insurance-related bills that are written without the input of independent agents. In Delaware, a first draft of a recently proposed employee misclassification bill redefined independent contractor in a way that would have completely upended the existing relationships between independent agents and insurance carriers, potentially jeopardizing their compensation programs. IA&B and other industry representatives promptly requested an amendment to preserve agencies’ status as independent contractors and the continued ability for carriers to compensate agents through commissions. In Maryland, a proposal to ban the use of credit-based insurance scoring (CBIS) was dramatically reduced in scope after IA&B input, instead allowing individuals to apply for exceptions to existing CBIS rating rules based on certain life events, such as identity theft, or the death of a spouse, child, or parent. IA&B also convinced the Maryland Senate to remove a demographic reporting requirement 12
Laws are like sausages; it is better not to see them being made. For every law that makes it way to the Governor’s desk, there are typically several iterations of amendments and language that was scrapped due to the unintended effects they would have. Elected officials come from a wide variety of backgrounds; they can’t be expected to be an expert in every topic they vote on. When IA&B staff meets with lawmakers, we bring the expertise and experience of our independent agents to the table, a resource that lawmakers typically find value in. We also talk with legislators about the issues independent agents are facing that they may be able to solve. In Pennsylvania, the Cannabis Banking & Insurance Act was passed earlier this year after IA&B staff discussed with lawmakers a legislative issue that made independent agents at risk of penalty for providing their services to legal cannabis-related businesses. The conversations and meetings between IA&B staff and our elected officials don’t just benefit agents. Many lawmakers see IA&B and its members as a resource they can rely on – a way to understand the complicated world of insurance and be better leaders for their state.
SEPTEMBER 2022