Political Stakes are High in 2010

Before most people put away their holiday decorations, the Big “I” Capitol Hill team was hard at work making sure that the 300,000 agents, brokers and professionals they represent have a strong voice in Washington, D.C. Although the health care debate dominated headlines in 2009 and continues, many other issues that impact independent insurance agents and brokers are on deck for 2010, including:

Financial Services Regulatory Reform: As decision-makers in Washington, D.C., continue to work on financial services regulatory reform, it’s critical to note that the insurance market has been well-regulated at the state level. The Big “I” is leading the fight to protect independent agents and brokers from needless additional oversight and continues to aggressively lobby against federal regulation of the insurance market (such as the Optional Federal Charter (OFC) bill currently pending in the House). Congress should focus on targeted efforts such as the National Association of Registered Agents and Brokers (NARAB) Reform Act (H.R. 2554) which would reform nonresident producer licensing.

Flood Insurance: In 2009 alone, the National Flood Insurance Program (NFIP) was saved from expiration four times through short-term extensions. The Big “I” is optimistic that Congress will start deliberations on a long-term extension in early 2010 and reform the NFIP to include an increase in maximum coverage limits and the addition of both business interruption insurance and additional living expenses coverage.

Crop Insurance: The U.S. Department of Agriculture has submitted its first draft of the Standard Reinsurance Agreement (SRA), which establishes the terms for delivering the Federal Crop Insurance Program (FCIP) to farmers by the private sector. The SRA affects the selling, servicing and adjusting costs for all policies. The Big “I” strongly opposes the language in the first SRA draft that would result in a devastating blow to the crop insurance market, potentially inhibiting crop insurers’ ability to effectively deliver crop insurance. The administration also wants to cut $4 billion over five years from delivery expenses (on top of the $6.4 billion cut in the 2008 Farm Bill—the effects of which have not yet been quantified). The Big “I” continues efforts to protect the private-public partnership that has made the FCIP successful for America’s farmers.

Estate Tax/Other Tax Issues: With the estate tax in limbo and the 2001 and 2003 tax cuts scheduled to expire Dec. 31, 2010, the plight to educate Congress on the impact of tax policy on small business rages on. The Big “I” is lobbying to decrease the estate tax rate and/or increase the exemption amount to provide permanent relief to family-owned small businesses across the country. Additionally, the association is pushing to extend the individual income tax rates to prevent tax increases for the thousands of independent insurance agencies that are organized as subchapter S corporations and pay individual tax rates. The Big “I” strongly opposes legislation that would raise taxes on individuals and small businesses, including efforts to decrease the itemized deduction limit for individuals in the top tax brackets from 35% to 28%.

In order to help lobby on all of these issues, at the beginning of 2009, InsurPac, the Big “I” political action committee (PAC), set a goal of raising $1 million and hit the mark in the final days of the year. The final 2009 total was $1,006,970.50, setting a new record for receipts in a calendar year and surpassing the $1 million dollar mark for the first time. InsurPac remains the largest property-casualty PAC and has broken records for the ninth consecutive year. In disbursing contributions, InsurPac does not look at party affiliation but supports representatives, senators and candidates for federal office who have been supportive of the independent agency system. The Big “I” and InsurPac distribute 100% of its voluntary contributions to federal campaigns and, as a result, have an impressive bipartisan track record in Congress and on the campaign trail.

In 2008, InsurPAC broke the previous record by raising $901,985.84. In the 2007–2008 election cycle, more than $1.6 million was disbursed to representatives, senators and other candidates for federal office. Ninety-two percent of InsurPac-supported candidates won in 2008 with 222 victories of the 241 races it supported.

While Election Day victories and fundraising numbers are impressive, the relationships developed via InsurPac are even more important. While these relationships obviously don’t guarantee votes, they provide opportunities to meet with key decision makers at the appropriate time and educate them on the agent perspective. Join agents from around the country to help educate lawmakers on what matters to your business next month during the Big “I” Legislative Conference & Convention, March 3–5, at the Marriott Wardman Park in Washington, D.C.


Margarita Tapia (margarita.tapia@iiaba.net) is Big “I” director of public affairs.