The prospect of a national “czar” for insurance regulation is again rearing its ugly head, according to a recent articleposted on IFAwebnews.com. The comprehensive story lays out arguments both pro and con for a bill that has been introduced in Congress to authorize an Office of National Insurance.

I have made it known that I am no fan of federal regulation of just about anything, unless it involves an issue of public safety or trade that is not already addressed by the states. In the case of insurance, state-based regulation has worked just fine, thank you very much.

That doesn’t mean that there aren’t occassional blips, or challenges for some to overcome. But our U.S. Constitution was set up to ensure states’ rights, hence the state-by-state controversies about such subjects as same-sex marriage, gun ownership, illegal immigrant drivers licenses, gambling, etc., etc. Such a system of government prevents a federal government from becoming too powerful and onerous to its citizens; can you say IRS or Social Security?

A national life insurance association wants an optional federal charter for ease of product roll out; the group that represents state insurance commissioners wants just the opposite to ensure fair protection of state citizens.

“The establishment of a functional insurance regulator at the federal level . . . is an appropriate and essential adjunct to broader reform efforts,” said Frank Keating, president and CEO of the American Council of Life Insurers (ACLI), which supports the bill. By that, one could assume that he means even further federal government intrusion into the insurance industry.

By contrast, New Hampshire Insurance Commissioner Roger Sevigny contends that “this is not a reform bill, it is a deregulation bill — aimed at stripping the states of insurance oversight authority and denying consumers of the time-tested protections that regulatory power provides.” Sevigny is president of the National Association of Insurance Commissioners (NAIC).

The National Association of Mutual Insurance Companies weighed in on the proposal. “This convoluted legislation would create a huge new bureaucracy that would have broad, ambiguous powers,” Jimi Grande, NAMIC’s vice president of federal and political affairs, said in a statement. “The ONI, as described in the legislation, would create multiple layers of regulation leading to confusion and higher costs for consumers.”