NAIC proposed laws: Battle Card Quiz 1 # 8

edited September 2022 in Porter.2-Devlpt

the question is "describe the purpose of the NAIC model bills passed AFTER McCarran-Ferguson"

the answer " NAIC model bills purpose:
- permitted cooperative rate-setting to ensure fair prices (provided competition wasn't hindered)
- ensured rates were not inadequate, excessive, unfairly discriminatory"

my question:
based on the wiki article the NAIC model law is under the US v SEUA case section, was the NIAC act in response to US v SEUA or McCarron-Ferguson Act (which is like saying both since McCarron-Ferguson Act was in response to US v SEUA)?

Comments

  • NAIC model law sought to bring about the changes that were later solidified in the M-F act, and they were put to use by the states after the M-F act.

  • edited September 2022

    so the phrase NAIC model bills refers to bills passed by individual states after McCarron-Ferguson Act?

  • NAIC first comes up with its model bills, with the intention of them being adopted by the states. States later decide to adopt, partially or in full, these model bills into their legislation. NAIC also has the capability of advocating for state regulation of insurance. This is what they did by promulgating their model bills that went contrary to the SEUA decision. After a certain amount of legislative lobbying in this manner, M-F came into effect that substantiated NAIC's wishes.

  • so I think my question on the card still stands the NIAC model bills came before M-F not after. the card's question says AFTER M-F

  • edited September 2022

    The Porter text is a little confusing on this topic. Here's the sequence of events as described in Porter:

    • SEUA decision in 1944
    • Reaction to the SEUA decision: NAIC makes several recommendations including pressuring Congress to enact legislation under the Commerce Clause of the Constitution that would allow states to continue regulating insurance. NAIC also recommended allowing cooperative rate-setting.
    • McCarran-Ferguson Act
    • Post McCarrarn-Ferguson: NAIC model bills introduced to allow cooperation in rate-setting.

    So the text is saying recommendations from NAIC and model bills from NAIC are different things, which I suppose they are, but I think that's where the confusion arises. I've made a few edits to the wiki article in the last paragraph of this section:

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