I
103D CONGRESS
2D SESSION
H. R. 9
To modify the antitrust exemption applicable to the business of insurance.
IN THE HOUSE OF REPRESENTATIVES
JANUARY 5, 1993
Mr. BROOKS introduced the following bill; which was referred to the
Committee on the Judiciary
JUNE 2, 1994
Additional sponsors: Mr. EDWARDS of California, Miss COLLINS of Michigan,
Mr. KOPETSKI, and Mr. JOHNSTON of Florida
A BILL
To modify the antitrust exemption applicable to the business
of insurance.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ‘‘Insurance Competitive
Pricing Act of 1993’’.
SEC. 2. AMENDMENTS.
Section 2 of the Act of March 9, 1945 (59 Stat. 34;
15 U.S.C. 1012), commonly known as the McCarran-Fer-
guson Act, is amended—
(1) in subsection (b)—
(A) by striking ‘‘: Provided, That after
June 30, 1948,’’ and inserting ‘‘, except that’’,
(B) by inserting ‘‘section 5 of’’ after
‘‘Clayton Act, and’’,
(C) by inserting ‘‘as such section 5 relates
to monopolies, attempts to monopolize, and un-
lawful restraints of trade,’’ after ‘‘Commission
Act, as amended,’’, and
(D) by striking ‘‘that such business’’ and
all that follows through ‘‘law.’’ and inserting
the following:
‘‘that—
‘‘(1) such business is not regulated by State
law; or
‘‘(2) the conduct of a person engaged in such
business involves—
‘‘(A) price fixing;
‘‘(B) allocating with a competitor a geo-
graphical area in which, or persons to whom,
insurance will be offered for sale;
‘‘(C) unlawfully tying the sale or purchase
of—
‘‘(i) one type of insurance to the sale
or purchase of another type of insurance;
or
‘‘(ii) any type of insurance to the sale
or purchase of any other service or prod-
uct; or
‘‘(D) monopolizing, or attempting to mo-
nopolize, any part of the business of insur-
ance.’’, and
(2) by adding at the end the following:
‘‘(c) The conduct referred to in subsection (b)(2)
shall not include making a contract, or engaging in a com-
bination or conspiracy—
‘‘(1) to collect, compile, or disseminate histori-
cal loss data;
‘‘(2) to determine a loss development factor ap-
plicable to historical loss data; or
‘‘(3) to perform actuarial services if such con-
tract, combination, or conspiracy does not involve a
restraint of trade.
‘‘(d) During the transition period, the conduct re-
ferred to in subsection (b)(2) shall not include making a
contract, or engaging in a combination or conspiracy, to
determine a trend factor.
‘‘(e) For purposes of this section—
‘‘(1) the term ‘historical loss data’ means infor-
mation respecting claims paid, or reserves held for
claims reported, by any person engaged in the busi-
ness of insurance;
‘‘(2) the term ‘loss development factor’ means
an adjustment to be made to reserves held for losses
incurred for claims reported by any person engaged
in the business of insurance, for the purpose of
bringing such reserves to an ultimate paid basis;
‘‘(3) the term ‘transition period’ means—
‘‘(A) the 4-year period beginning on the ef-
fective date of the Insurance Competitive Pric-
ing Act of 1993, in the case of a person—
‘‘(i) that wrote insurance having an
aggregate amount of annual premiums less
than $20,000,000; and
‘‘(ii) not more than 50 percent of
which was owned or controlled by another
person engaged in the business of insur-
ance;
in the then most recently ended 1-year period;
or
‘‘(B) the 2-year period beginning on such
effective date, in the case of any person to
which subparagraph (A) does not apply; and
‘‘(4) the term ‘trend factor’ means an adjust-
ment to be made to losses incurred for claims re-
ported by any person engaged in the business of in-
surance, to reflect a change in inflation or any other
change in the estimated loss costs incurred by per-
sons engaged in the business of insurance.’’.
SEC. 3. EFFECTIVE DATE.
This Act shall take effect 1 year after the date of
the enactment of this Act.
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