With Unprecedented Support, Multistate Insurance Licensing Clearinghouse Has Never Been Closer; Research Demonstrates Need for Efficient Licensing
WASHINGTON, D.C. – The Insured Retirement Institute (IRI) told its members today that efforts to advance legislation that would establish an insurance licensing clearinghouse for financial professionals operating in multiple states have never been closer to achieving the goal. Securing passage of the National Association of Registered Agents and Brokers Act (NARAB II) remains one of IRI’s top legislative priorities, and a new opportunity to do so may be on the horizon.
“With recent legislative victories in hand, it’s clear that there is unprecedented momentum and support for moving NARAB II forward this year,” said IRI Senior Vice President and General Counsel Lee Covington during remarks at the IRI Government, Legal and Regulatory Conference. “We will continue to work with congressional leaders to find the right legislative vehicle to get it across the finish line and off to the White House for President Obama’s signature.”
The Senate passed NARAB II legislation, as part of a flood insurance bill, in late January. But while the House had already passed standalone NARAB II legislation in September of 2013, it passed its own version of the flood bill without NARAB II. The next opportunity for NARAB II passage may be to include it in legislation to extend the terrorism risk insurance program, which will expire at year’s end without reauthorization. The House Financial Services Committees recently added NARAB II to its reauthorization bill (H.R. 4871).
“Whether it’s through this legislation, or another vehicle, we will continue to pursue legislation to establish efficient and cost-effective insurance licensing for those operating in multiple states,” Covington said. “IRI’s research continues to show that the current process is burdensome and may be impeding broader utilization of lifetime income products.”
IRI announced a research initiative in 2012 to support its advocacy efforts in support of an insurance licensing clearinghouse for financial professionals operating in multiple states. The results, which were published in a report that was released last year, found that maintaining state insurance licenses across multiple jurisdictions is a regulatory obstacle that may impede broker-dealers’ ability and financial advisors’ willingness to sell lifetime income products. Adding to that, previously unreleased data from an investor survey conducted by IRI earlier this year found that 43 percent of investors said they are considering relocating to another state for retirement. A separate IRI survey of Baby Boomers found that three in four would want to keep working with their financial planner if they relocated to another state.
“NARAB II would ensure that these clients could continue to work with their financial professionals and still have access to a full suite of lifetime income strategies, without forcing the advisor to overcome the burden of redundant insurance licensing requirements,” Covington said. “NARAB II will help ensure that financial professionals can focus more on meeting their clients’ needs. Now is the time to get this done.”
About the Insured Retirement Institute
The Insured Retirement Institute (IRI) is the leading association for the retirement income industry. IRI proudly leads a national consumer coalition of more than 30 organizations, and is the only association that represents the entire supply chain of insured retirement strategies. IRI members are the major insurers, asset managers, broker-dealers/distributors, and 150,000 financial professionals. As a not-for-profit organization, IRI provides an objective forum for communication and education, and advocates for the sustainable retirement solutions Americans need to help achieve a secure and dignified retirement. Learn more at www.irionline.org.