I 
110TH CONGRESS 
2D SESSION 
H. R. 5611 
To reform the National Association of Registered Agents and Brokers, and 
for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
MARCH 13, 2008 
Mr. SCOTT of Georgia (for himself, Mr. DAVIS of Kentucky, Mr. GERLACH, 
Mr. MANZULLO, Mr. BARRETT of South Carolina, Mr. NEUGEBAUER, 
Mr. JONES of North Carolina, Mr. WILSON of Ohio, Mr. CLAY, Mr. 
ROSS, Mr. MEEKS of New York, Ms. MOORE of Wisconsin, Mr. DON-
NELLY, Ms. GINNY BROWN-WAITE of Florida, and Mr. LINCOLN DAVIS 
of Tennessee) introduced the following bill; which was referred to the 
Committee on Financial Services 
A BILL 
To reform the National Association of Registered Agents 
and Brokers, and for other purposes. 
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 ‘‘National Association 
of Registered Agents and Brokers Reform Act of 2008’’. 
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SEC. 2. REESTABLISHMENT OF THE NATIONAL ASSOCIA-
TION OF REGISTERED AGENTS AND BRO-
KERS. 
(a) IN GENERAL.—Subtitle C of title III of the 
Gramm-Leach-Bliley Act (15 U.S.C. 6751 et seq.) is 
amended to read as follows: 
‘‘Subtitle C—National Association 
of Registered Agents and Brokers 
‘‘SEC. 
321. 
NATIONAL 
ASSOCIATION 
OF 
REGISTERED 
AGENTS AND BROKERS. 
‘‘(a) ESTABLISHMENT.—There is established the Na-
tional Association of Registered Agents and Brokers 
(hereafter in this subtitle referred to as the ‘Association’). 
‘‘(b) STATUS.—The Association shall— 
‘‘(1) be a nonprofit corporation; 
‘‘(2) have succession until dissolved by an Act 
of Congress; 
‘‘(3) not be an agent or instrumentality of the 
United States Government; and 
‘‘(4) except as otherwise provided in this sub-
title, be subject to, and have all the powers conferred 
upon a nonprofit corporation by the District of Co-
lumbia Nonprofit Corporation Act (D.C. Code, sec. 
29–301.01 et seq.). 
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‘‘SEC. 322. PURPOSE. 
‘‘The purpose of the Association shall be to provide 
a mechanism through which licensing, continuing edu-
cation, and other insurance producer qualification require-
ments and conditions can be adopted and applied on a 
multi-state basis, while preserving the right of States to 
license, supervise, and discipline insurance producers, and 
to prescribe and enforce laws and regulations with regard 
to insurance-related consumer protection and unfair trade 
practices. 
‘‘SEC. 323. MEMBERSHIP. 
‘‘(a) ELIGIBILITY.— 
‘‘(1) IN GENERAL.—Any insurance producer li-
censed in its home State shall be eligible to become 
a member in the Association. 
‘‘(2) INELIGIBILITY FOR SUSPENSION OR REV-
OCATION OF LICENSE.—Notwithstanding paragraph 
(1), a State-licensed insurance producer shall not be 
eligible to become a member if a State insurance 
regulator has suspended or revoked such producer’s 
license in that State during the 3-year period pre-
ceding the date on which such producer applies for 
membership. 
‘‘(3) RESUMPTION OF ELIGIBILITY.—Paragraph 
(2) shall cease to apply to any insurance producer 
if— 
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‘‘(A) the State insurance regulator renews 
the license of such producer in the State in 
which the license was suspended or revoked; or 
‘‘(B) the suspension or revocation is subse-
quently overturned. 
‘‘(4) 
CRIMINAL
BACKGROUND
CHECK
RE-
QUIRED.— 
‘‘(A) IN
GENERAL.—A State-licensed in-
surance producer shall not be eligible to become 
a member unless the producer has submitted to 
a national criminal background record check. 
‘‘(B) CRIMINAL BACKGROUND CHECK OR-
DERED BY HOME STATE.—Any insurance pro-
ducer licensed in a State that, as a condition 
for such licensure, requires the submission of 
identification information to the Federal Bu-
reau of Investigation for a national criminal 
background record check shall be deemed to 
have submitted to a national criminal back-
ground record check for purposes of subpara-
graph (A). 
‘‘(C) CRIMINAL HISTORY CHECK ORDERED 
BY ASSOCIATION.— 
‘‘(i) IN
GENERAL.—The Association 
may submit identification information ob-
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tained from any State-licensed insurance 
producer licensed in a State that has not 
submitted to a national criminal back-
ground record check, and a request for a 
national criminal background record check 
of such producer, to the Federal Bureau of 
Investigation. 
‘‘(ii) REGULATIONS.—The board of 
directors of the Association shall prescribe 
regulations for obtaining identification in-
formation and criminal background record 
information, including the establishment of 
fees required to perform a criminal back-
ground record check. 
‘‘(D) ATTORNEY
GENERAL
AUTHORIZA-
TION.—Upon receiving a request from the Asso-
ciation, the Attorney General shall— 
‘‘(i) search the records of the Criminal 
Justice Information Services Division of 
the Federal Bureau of Investigation, and 
any other similar database over which the 
Attorney General has authority and deems 
appropriate, for any criminal background 
records (including wanted persons informa-
tion) corresponding to the identification in-
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formation provided under subparagraph 
(F); and 
‘‘(ii) provide any relevant information 
contained in such records that pertain to 
the request directly to the Association. 
‘‘(E) 
RELEVANT
INFORMATION
DE-
FINED.—For purposes of subparagraph (D)(ii), 
the term ‘relevant information’ means any of 
the following records: 
‘‘(i) All felony convictions. 
‘‘(ii) All misdemeanor convictions in-
volving— 
‘‘(I) violation of a law involving 
financial activities; 
‘‘(II) dishonesty or breach of 
trust, within the meaning of section 
1033 of title 18, United States Code, 
including taking, withholding, mis-
appropriating, or converting money or 
property; 
‘‘(III) failure to comply with 
child support obligations; 
‘‘(IV) failure to pay taxes; and 
‘‘(V) domestic violence, child 
abuse, burglary of a dwelling, or a 
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criminal offense that has as an ele-
ment the use or attempted use of 
physical force, or threat of great bod-
ily harm, or the use, attempted use, 
or threatened use of a deadly weapon, 
against an individual, including com-
mitting or attempting to commit mur-
der, manslaughter, kidnapping, aggra-
vated assault, forcible sex offenses, 
robbery, arson, extortion, and extor-
tionate extension of credit. 
‘‘(F) FORM
OF
REQUEST.—A request 
under subparagraph (C) shall include a copy of 
any necessary identification information re-
quired by the Attorney General concerning the 
person about whom the record is requested and 
a statement signed by the person acknowledging 
that the Association may request the search. 
‘‘(G) LIMITATION ON PERMISSIBLE USES 
OF INFORMATION.—Information obtained under 
this section may— 
‘‘(i) be used only for regulatory or law 
enforcement purposes or for purposes of 
determining compliance with membership 
criteria established by the Association; 
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‘‘(ii) be disclosed only to the Associa-
tion, State insurance regulators, or Federal 
or State law enforcement agencies; and 
‘‘(iii) be disclosed only if the recipient 
agrees to— 
‘‘(I) maintain the confidentiality 
of such information; and 
‘‘(II) limit the use of such infor-
mation to the purposes described in 
clause (i). 
‘‘(H) PENALTY
FOR
IMPROPER
USE.— 
Whoever uses any information obtained under 
this section knowingly and willfully for an un-
authorized purpose shall be fined under title 18, 
United States Code, imprisoned for not more 
than 2 years, or both. 
‘‘(I) RELIANCE
ON
INFORMATION.—Nei-
ther the Association nor any of its directors, of-
ficers, or employees who reasonably rely on in-
formation provided under this section shall be 
liable in any action for using information as 
permitted under this section in good faith. 
‘‘(J) CLARIFICATION OF SECTION 1033.— 
‘‘(i) IN
GENERAL.—With respect to 
any 
action 
brought 
under 
section 
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1033(e)(1)(B) of title 18, United States 
Code, no person engaged in the business of 
conducting financial activities shall be sub-
ject to any penalty resulting from such sec-
tion if the individual whom the person per-
mitted to engage in the business of insur-
ance is a member of the Association or is 
licensed, or approved (as part of an appli-
cation or otherwise), by a State insurance 
regulator that performs criminal back-
ground checks under this section, unless 
such person knows that the individual is in 
violation of section 1033(e)(1)(A) of such 
title. 
‘‘(ii) 
FINANCIAL
ACTIVITIES
DE-
FINED.—For purposes of this subpara-
graph, the term ‘financial activities’— 
‘‘(I) means banking activities (in-
cluding the ownership of a bank), se-
curities activities, insurance activities, 
or commodities activities; and 
‘‘(II) includes all activities that 
are financial in nature or are inci-
dental to a financial activity (as de-
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fined under section 4(k) of the Bank 
Holding Company Act of 1956). 
‘‘(K) FEES.—The Attorney General may 
charge a reasonable fee for the provision of in-
formation under this paragraph. 
‘‘(L) RULE OF CONSTRUCTION.—No provi-
sion of this paragraph shall be construed as— 
‘‘(i) requiring a State insurance regu-
lator to perform criminal background 
checks under this section; or 
‘‘(ii) superseding or otherwise limiting 
any other authority that allows access to 
criminal background records. 
‘‘(M) REGULATIONS.—The Attorney Gen-
eral may prescribe regulations to carry out this 
paragraph. 
‘‘(N) INELIGIBILITY FOR MEMBERSHIP.— 
The Association may deny membership to any 
State-licensed insurance producer on the basis 
of criminal history information obtained pursu-
ant to subparagraph (D). 
‘‘(b) AUTHORITY TO ESTABLISH MEMBERSHIP CRI-
TERIA.—The Association may establish membership cri-
teria that— 
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‘‘(1) bear a reasonable relationship to the pur-
poses for which the Association was established; and 
‘‘(2) do not unfairly limit the access of smaller 
agencies to the Association membership, including 
imposing discriminatory membership fees on smaller 
insurance producers. 
‘‘(c) ESTABLISHMENT OF CLASSES AND CATEGORIES 
OF MEMBERSHIP.— 
‘‘(1) CLASSES OF MEMBERSHIP.—The Associa-
tion may establish separate classes of membership, 
with separate criteria, if the Association reasonably 
determines that performance of different duties re-
quires different levels of education, training, experi-
ence, or other qualifications. 
‘‘(2) CATEGORIES.— 
‘‘(A) SEPARATE CATEGORIES FOR INDIVID-
UALS PERMITTED.—The Association may estab-
lish separate categories of membership for indi-
viduals and for other persons within each class, 
based on the types of licensing categories that 
exist under State laws. 
‘‘(B) SEPARATE TREATMENT FOR DEPOSI-
TORY INSTITUTIONS PROHIBITED.—No special 
categories of membership, and no distinct mem-
bership criteria, shall be established for mem-
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bers which are depository institutions or for 
employees, agents, or affiliates of depository in-
stitutions. 
‘‘(d) MEMBERSHIP CRITERIA.— 
‘‘(1) IN GENERAL.—The Association may estab-
lish criteria for membership which shall include 
standards for personal qualifications, education, 
training, and experience. 
‘‘(2) QUALIFICATIONS.—In establishing criteria 
under paragraph (1), the Association shall consider 
the highest levels of insurance producer qualifica-
tions established under the licensing laws of the 
States. 
‘‘(3) ASSISTANCE FROM STATES.— 
‘‘(A) IN GENERAL.—The Association may 
request a State to provide assistance in inves-
tigating and evaluating a prospective member’s 
eligibility for membership in the Association. 
‘‘(B) RULE OF CONSTRUCTION.—Subpara-
graph (A) shall not be construed as requiring or 
authorizing any State to adopt new or addi-
tional requirements concerning the licensing or 
evaluation of insurance producers. 
‘‘(e) EFFECT OF MEMBERSHIP.— 
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‘‘(1) AUTHORITY OF ASSOCIATION MEMBERS.— 
Membership in the Association shall authorize an in-
surance producer to sell, solicit, negotiate, effect, 
procure, deliver, renew, continue, or bind insurance 
in any State for any line or lines of insurance speci-
fied in such producer’s home State license, and exer-
cise all such incidental powers, as shall be necessary 
to carry out such activities, including claims adjust-
ments and settlement, risk management, employee 
benefits advice, retirement planning, and any other 
insurance-related consulting activities. 
‘‘(2) ACTIVITIES OF MEMBERS OF THE ASSO-
CIATION.—No State, other than a member’s home 
State, may, by statute, regulation, order, interpreta-
tion, or otherwise, deny a license to a member of the 
Association which has paid the requisite licensing fee 
for such State to engage in any activity within the 
scope of authority granted under paragraph (1). 
‘‘(3) DUPLICATIVE LICENSES.—Neither the As-
sociation nor any State, other than the member’s 
home State, may require an individual member to 
obtain a business entity license or membership in 
order to engage in any activity within the scope of 
authority granted in paragraph (1) or in order for 
the member or any employer, employee, or affiliate 
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of the member to receive compensation for the mem-
ber’s performance of any such activity. 
‘‘(4) AGENT FOR REMITTING FEES.—The Asso-
ciation shall act as any member’s agent for purposes 
of remitting licensing fees to any State pursuant to 
subparagraph (2). 
‘‘(5) PRESERVATION OF STATE CONSUMER PRO-
TECTION AND MARKET CONDUCT REGULATION.—No 
provision of this section shall be construed as alter-
ing or affecting the continuing effectiveness of any 
law, regulation, provision, or other action of any 
State which purports to regulate market conduct or 
unfair trade practices or establish consumer protec-
tions to the extent that such law, regulation, provi-
sion, or other action is not inconsistent with the pro-
visions of this subtitle. 
‘‘(f) BIENNIAL RENEWAL.—Membership in the Asso-
ciation shall be renewed on a biennial basis. 
‘‘(g) CONTINUING EDUCATION.— 
‘‘(1) IN GENERAL.—The Association shall es-
tablish, as a condition of membership, continuing 
education requirements which shall be comparable to 
the continuing education requirements under the li-
censing laws of a majority of the States. 
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‘‘(2) STATE CONTINUING EDUCATION REQUIRE-
MENTS.—A member may not be required to satisfy 
continuing education requirements imposed under 
the laws, regulations, provisions, or actions of any 
State other than such member’s home State. 
‘‘(3) RECIPROCITY.— 
‘‘(A) LIMITATION
ON
HOME
STATE.—No 
home State of a member of the Association 
shall require such member to satisfy any con-
tinuing education requirements that are equiva-
lent to any continuing education requirements 
of the Association that have been satisfied by 
the member during the applicable licensing pe-
riod. 
‘‘(B) LIMITATION ON ASSOCIATION.—The 
Association shall not require a member to sat-
isfy continuing education requirements that are 
equivalent to any continuing education require-
ments of the member’s home State that have 
been satisfied by the member during the appli-
cable licensing period. 
‘‘(4) LIMITATION ON ASSOCIATION.—The Asso-
ciation shall not directly or indirectly offer any con-
tinuing education courses for insurance producers. 
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‘‘(h) PROBATION, SUSPENSION AND REVOCATION.— 
The Association may place an insurance producer that is 
a member of the Association on probation or suspend or 
revoke such producer’s membership in the Association, as 
the Association determines to be appropriate, if— 
‘‘(1) the producer fails to meet the applicable 
membership criteria of the Association; or 
‘‘(2) the producer has been subject to discipli-
nary action pursuant to a final adjudicatory pro-
ceeding under the jurisdiction of a State insurance 
regulator. 
‘‘(i) OFFICE OF CONSUMER COMPLAINTS.— 
‘‘(1) IN GENERAL.—The Association shall es-
tablish an office of consumer complaints that shall— 
‘‘(A) receive and, when appropriate, inves-
tigate complaints from both consumers and 
State insurance regulators related to members 
of the Association; 
‘‘(B) maintain records of all complaints re-
ceived in accordance with subparagraph (A) and 
make such records available to the National As-
sociation of Insurance Commissioners (herein-
after in this subtitle referred to as the ‘NAIC’) 
and to each State insurance regulator for the 
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State of residence of the consumer who filed the 
complaint; and 
‘‘(C) refer, when appropriate, any such 
complaint to any appropriate State insurance 
regulator. 
‘‘(2) TELEPHONE
AND
OTHER
ACCESS.—The 
office of consumer complaints shall maintain a toll- 
free telephone number for the purpose of this sub-
section and, as practicable, other alternative means 
of communication with consumers, such as an Inter-
net web page. 
‘‘SEC. 324. BOARD OF DIRECTORS. 
‘‘(a) ESTABLISHMENT.—There is established the 
board of directors of the Association (hereafter in this sub-
title referred to as the ‘Board’) for the purpose of gov-
erning and supervising the activities of the Association 
and the members of the Association. 
‘‘(b) POWERS.—The Board shall have such powers 
and authority as may be specified in the bylaws of the 
Association. 
‘‘(c) COMPOSITION.— 
‘‘(1) IN GENERAL.—The Board shall be com-
posed of 9 members, of whom— 
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‘‘(A) 4 shall be State insurance commis-
sioners appointed in the manner provided in 
paragraph (2), and 
‘‘(B) 5 shall be insurance industry rep-
resentatives appointed in the manner provided 
in paragraph (3). 
‘‘(2) MEMBERS APPOINTED BY THE NAIC.— 
‘‘(A) IN GENERAL.—The NAIC shall ap-
point 1 member of the Board from among State 
insurance commissioners in each of the fol-
lowing 3 categories of States: 
‘‘(i) The 18 States with the smallest 
total direct written premiums from all in-
surance policies written in such States. 
‘‘(ii) The 18 States with the largest 
total direct written premiums from all in-
surance policies written in such States. 
‘‘(iii) The States that are not among 
the States described in clauses (i) and (ii). 
‘‘(B) AT-LARGE
MEMBER.—The Board 
members appointed pursuant to paragraph (A) 
shall, by majority vote, elect a 4th State insur-
ance commissioner to serve as an at-large mem-
ber of the Board. 
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‘‘(3) MEMBERS
APPOINTED
BY
INSURANCE 
TRADE ASSOCIATIONS.— 
‘‘(A) INSURANCE PRODUCER REPRESENTA-
TIVES.—3 of the 5 members who are insurance 
industry representatives shall be appointed as 
follows by the following trade associations or 
their successor organizations: 
‘‘(i) 1 member appointed by the Coun-
cil of Insurance Agents and Brokers from 
among representatives of such association. 
‘‘(ii) 1 member appointed by the Inde-
pendent Insurance Agents and Brokers of 
America from among representatives of 
such association. 
‘‘(iii) 1 member appointed by the Na-
tional Association of Insurance and Finan-
cial Advisors from among representatives 
of such association. 
‘‘(B) PROPERTY AND CASUALTY INSURER 
REPRESENTATIVE.—1 of the 5 members who 
are insurance industry representatives shall be 
appointed by the American Insurance Associa-
tion, the National Association of Mutual Insur-
ance Companies, and the Property and Cas-
ualty Insurers Association of America from 
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the Senate, appoint 4 members to the 
Board without considering the views of the 
NAIC, 3 of whom shall meet the selection 
requirements of paragraph (2)(A) and 1 of 
whom shall meet the selection require-
ments of paragraph (3)(B). 
‘‘(C) PROCEDURES FOR OBTAINING INSUR-
ANCE
TRADE
ASSOCIATION
GROUP
APPOINT-
MENT RECOMMENDATIONS.— 
‘‘(i) 
PRESIDENTIAL
APPOINTMENT 
FROM LIST.—If any group of nominating 
insurance 
trade 
associations 
identified 
under subparagraph (A), (B), or (C) of 
paragraph (3) fails to appoint members of 
the Board as provided under such subpara-
graph within 60 days after the date of the 
enactment of the National Association of 
Registered Agents and Brokers Reform 
Act of 2008, the President shall, with the 
advice and consent of the Senate, make the 
requisite appointments pursuant to each 
such subparagraph from a list of can-
didates recommended to the President by 
such group. 
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‘‘(ii) 
PRESIDENTIAL
APPOINTMENT 
WITHOUT
A
LIST.—If the nominating 
group of insurance trade associations iden-
tified under subparagraph (A), (B), or (C) 
of paragraph (3) fails to provide a list 
within 90 days after date of the enactment 
of the National Association of Registered 
Agents and Brokers Reform Act of 2008, 
or if any list that is provided does not com-
ply with the requirements of the subpara-
graph, the President shall, with the advice 
and consent of the Senate, make the req-
uisite appointments without considering 
the views of such group. 
‘‘(iii) LIST OF RECOMMENDATIONS.— 
Any list of recommended candidates pro-
vided to the President by a nominating 
group of insurance trade associations iden-
tified under subparagraph (A), (B), or (C) 
of paragraph (3) shall include— 
‘‘(I) at least 2 recommended can-
didates from each association identi-
fied under paragraph (3)(A); 
‘‘(II) at least 2 recommended 
candidates, in the case of associations 
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identified under paragraph (3)(B); 
and 
‘‘(III) at least 2 recommended 
candidates, in the case of associations 
identified under paragraph (3)(C). 
‘‘(D) ALTERNATE APPOINTMENT OF STATE 
INSURANCE COMMISSIONERS.—If fewer than 4 
State insurance commissioners accept appoint-
ment to the Board pursuant to subparagraph 
(B), the President, with the advice and consent 
of the Senate, may appoint the remaining State 
insurance commissioner members of the Board 
from among individuals who are current or 
former State insurance commissioners, to the 
extent that— 
‘‘(i) any former insurance commis-
sioner appointed by the President shall not 
be employed by or have a present direct or 
indirect financial interest in any insurer or 
other entity in the insurance industry 
other than direct or indirect ownership of, 
or beneficial interest in, any insurance pol-
icy or annuity contract written or sold by 
an insurer; and 
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‘‘(ii) not more than 2 members ap-
pointed to membership on the Board under 
this subparagraph belong to the same po-
litical party as the President. 
‘‘(5) STATE
INSURANCE
COMMISSIONER
DE-
FINED.—For purposes of this subsection, the term 
‘State insurance commissioner’ means a person who 
serves in the position in State government, or on the 
board, commission, or other body that is the prin-
cipal insurance regulatory authority for the State. 
‘‘(d) TERMS.— 
‘‘(1) IN GENERAL.—The term of each Board 
member shall, after the initial appointment of the 
members of the Board, be for 2 years, with 1⁄2 of the 
members to be appointed each year and divided as 
evenly as possible between members appointed under 
paragraphs (2) and (3) of subsection (c). 
‘‘(2) LIMITATION
ON
SUCCESSIVE
TERMS.— 
Only directors appointed under subsection (c)(3)(A) 
from among representatives of insurance producers 
may be re-appointed for an additional term. 
‘‘(e) BOARD VACANCIES.— 
‘‘(1) IN GENERAL.—Any vacancy on the board 
of directors shall be filled as provided under sub-
paragraph (A) or (B) of paragraph (2), and any 
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member appointed to fill a vacancy occurring before 
the expiration of the term for which the member’s 
predecessor was appointed shall be appointed only 
for the remainder of that term. 
‘‘(2) ALTERNATE APPOINTMENT.—If the NAIC 
or a nominating group of trade associations fails to 
appoint a member to the Board to fill a vacancy 
within 60 days from the date that such vacancy oc-
curs, the President shall, with the advice and con-
sent of the Senate, make the requisite appointment 
pursuant to the procedures established under the ap-
plicable subparagraph of subsection (c)(4). 
‘‘(f) MEETINGS.—The Board shall meet at the call 
of the chairperson, or as otherwise provided by the bylaws 
of the Association. 
‘‘SEC. 325. OFFICERS. 
‘‘(a) POSITIONS.—The officers of the Association 
shall consist of a chairperson and a vice chairperson of 
the Board, an executive director, secretary, and treasurer 
of the Association, and such other officers and assistant 
officers as may be deemed necessary. 
‘‘(b) MANNER OF SELECTION.—Each officer of the 
Board and the Association shall be elected or appointed 
at such time, in such manner, and for such terms as may 
be prescribed in the bylaws of the Association. 
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‘‘SEC. 326. BYLAWS, RULES, AND DISCIPLINARY ACTION. 
‘‘(a) ADOPTION AND AMENDMENT OF BYLAWS.— 
‘‘(1) COPY
REQUIRED
TO
BE
FILED.—The 
board of directors of the Association shall submit to 
the President and the Congress any proposed bylaw 
or rules of the Association or any proposed amend-
ment to the bylaws or rules, accompanied by a con-
cise general statement of the basis and purpose of 
such proposal. 
‘‘(2) EFFECTIVE DATE.—Any proposed bylaw 
or rule or proposed amendment to the bylaws or 
rules shall take effect, after notice published in an 
insurance trade journal and opportunity for com-
ment, upon such date as the Association may des-
ignate. 
‘‘(b) DISCIPLINARY ACTION BY THE ASSOCIATION.— 
‘‘(1) SPECIFICATION OF CHARGES.—In any pro-
ceeding to determine whether membership shall be 
denied, suspended, revoked, or not renewed (here-
after in this section referred to as a ‘disciplinary ac-
tion’) or to determine whether a member of the As-
sociation should be placed on probation, the Associa-
tion shall bring specific charges, notify such member 
of such charges, give the member an opportunity to 
defend against the charges, and keep a record. 
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‘‘(2) SUPPORTING STATEMENT.—A determina-
tion to take disciplinary action shall be supported by 
a statement setting forth— 
‘‘(A) any act or practice in which such 
member has been found to have been engaged; 
‘‘(B) the specific provision of this subtitle, 
the rules or regulations under this subtitle, or 
the rules of the Association which any such act 
or practice is deemed to violate; and 
‘‘(C) the sanction imposed and the reason 
for such sanction. 
‘‘SEC. 327. POWERS. 
‘‘In addition to all the powers conferred upon a non-
profit corporation by the District of Columbia Nonprofit 
Corporation Act, the Association shall have the following 
powers: 
‘‘(1) To establish and collect such membership 
fees as the Association finds necessary to impose to 
cover the costs of its operations. 
‘‘(2) To adopt, amend, and repeal bylaws and 
rules governing the conduct of Association business 
and performance of its duties. 
‘‘(3) To establish procedures for providing no-
tice and opportunity for comment pursuant to sec-
tion 326(a). 
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‘‘(4) To enter into and perform such agree-
ments as necessary to carry out its duties. 
‘‘(5) To hire employees, professionals or special-
ists, and elect or appoint officers, and to fix their 
compensation, define their duties and give them ap-
propriate authority to carry out the purposes of this 
subtitle, and determine their qualification; and to es-
tablish the Association’s personnel policies and pro-
grams relating to, among other things, conflicts of 
interest, rates of compensation. and qualifications of 
personnel. 
‘‘(6) To borrow money. 
‘‘(7) To assess board member organizations and 
associations fees for such amounts that the Associa-
tion determines to be necessary and appropriate to 
organize and begin operations of the Association, 
which shall be treated as loans to be repaid by the 
Association with interest at market rate. 
‘‘SEC. 328. REPORT BY ASSOCIATION. 
‘‘(a) IN GENERAL.—As soon as practicable after the 
close of each fiscal year, the Association shall submit to 
the President and to the Congress a written report regard-
ing the conduct of its business, and the exercise of the 
other rights and powers granted by this subtitle, during 
such fiscal year. 
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‘‘(b) FINANCIAL STATEMENTS.—Each report sub-
mitted under subsection (a) with respect to any fiscal year 
shall include financial statements setting forth the finan-
cial position of the Association at the end of such fiscal 
year and the results of its operations (including the source 
and application of its funds) for such fiscal year. 
‘‘SEC. 329. LIABILITY OF THE ASSOCIATION AND THE DI-
RECTORS, OFFICERS, AND EMPLOYEES OF 
THE ASSOCIATION. 
‘‘(a) IN GENERAL.—The Association shall not be 
deemed to be an insurer or insurance producer within the 
meaning of any State law, rule, regulation, or order regu-
lating or taxing insurers, insurance producers, or other en-
tities engaged in the business of insurance, including pro-
visions imposing premium taxes, regulating insurer sol-
vency or financial condition, establishing guaranty funds 
and levying assessments, or requiring claims settlement 
practices. 
‘‘(b) LIABILITY OF THE ASSOCIATION, ITS DIREC-
TORS, OFFICERS, AND EMPLOYEES.—Neither the Associa-
tion nor any of its directors, officers, or employees shall 
have any liability to any person for any action taken or 
omitted in good faith under or in connection with any mat-
ter subject to this subtitle. 
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‘‘SEC. 330. PRESIDENTIAL REVIEW. 
‘‘(a) REMOVAL.—If the President determines and 
certifies to the Speaker of the House, the House Minority 
Leader, the Senate Majority Leader and the Senate Mi-
nority Leader that the Association is acting in a manner 
contrary to the purposes of this subtitle or has failed to 
perform its duties under this subtitle, the President may 
remove the entire existing Board for the remainder of the 
term to which the members of the Board were appointed 
and appoint, in accordance with section 324(c)(4) with the 
advice and consent of the Senate, new members to fill the 
vacancies on the Board for the remainder of such terms. 
‘‘(b) SUSPENSION
OF RULES
OR ACTIONS.—The 
President, or a person designated by the President for 
such purpose, may suspend the effectiveness of any rule, 
or prohibit any action, of the Association which the Presi-
dent or the designee determines and certifies to the Speak-
er of the House, the House minority leader, the Senate 
majority leader, and the Senate minority leader is contrary 
to the purposes of this subtitle. 
‘‘SEC. 331. RELATIONSHIP TO STATE LAW. 
‘‘(a) PREEMPTION
OF STATE LAWS.—State laws, 
regulations, provisions, or other actions purporting to reg-
ulate insurance producers shall be preempted to the extent 
provided in subsection (b). 
‘‘(b) PROHIBITED ACTIONS.— 
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‘‘(1) IN GENERAL.—No State shall— 
‘‘(A) impede the activities of, take any ac-
tion against, or apply any provision of law or 
regulation to, any insurance producer because 
that insurance producer or any affiliate plans to 
become, has applied to become, or is a member 
of the Association; 
‘‘(B) impose any requirement upon a mem-
ber of the Association that it pay different fees 
to be licensed or otherwise qualified to do busi-
ness in that State based on its residency; 
‘‘(C) impose any continuing education re-
quirements on non-resident insurance pro-
ducers; or 
‘‘(D) impose any licensing, registration, or 
appointment requirements upon or impede the 
activities of any non-resident insurance pro-
ducer that sells, solicits, negotiates, effects, pro-
cures, delivers, renews, continues, or binds in-
surance for commercial property and casualty 
risks to an insured with risks located in more 
than one State, provided that such non-resident 
insurance producer is otherwise licensed as an 
insurance producer in the State where the in-
sured maintains its principal place of business 
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