Remove politics from insurance

The New Mexico Legislature has a rare opportunity to improve New Mexico’s regulation of insurance by passing House Bill 45.

This bill, which is sponsored by Speaker Ken Martinez, D-Grants, Rep. Tom Taylor, R-Farmington, and Sen. Carroll Leavell, R-Jal, implements a constitutional amendment that was approved by voters last fall to remove insurance regulation from the Public Regulation Commission.

The idea behind this legislation came out of a report by the independent think tank Think New Mexico. The bill is carefully designed to insulate insurance regulation from politics.

It creates an independent committee that will be responsible for appointing future superintendents of insurance. This committee will be made up of bipartisan members appointed by the Legislature and governor, subject to strict requirements that it fairly balance the interests of insurance businesses and consumers.

House Bill 45 also includes numerous accountability measures, including a new prohibition on financial conflicts of interest, annual reports to the Legislature, governor and nominating committee, and a provision allowing the committee to remove the superintendent for any malfeasance in office. Additional accountability arises from the fact that the superintendent will be required to comply with about 800 pages of insurance statutes.

Finally, once insurance regulation is separated from the PRC, the new department will be required to have an annual, independent audit, which will result in more transparency.

I support House Bill 45 because it will insulate the regulation of insurance from political interference.

I speak from experience, as I was the first superintendent of insurance

appointed by the PRC in 1999, shortly after the commission was created. I frequently saw politics interfere with decisions that should have been made on the technical merits. For example, past PRC commissioners pressured the Insurance Division to hire unqualified but politically connected staff, which in turn led to the division being placed on probation by its national accrediting agency three times in the past 16 years.

As a result, under the PRC, the position of superintendent of insurance has been something of a revolving door. Every insurance superintendent who has ever served under the PRC (other than the one currently serving) has either been fired or forced to resign.

On Feb. 25, the House unanimously (64-0) approved House Bill 45. The bill must now be approved by the Senate, where it has been assigned to three committees. It must get through in the remaining days before the session concludes. Don Letherer Former Insurance Superintendent