[Congressional Bills 109th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2401 Introduced in House (IH)]






109th CONGRESS
  1st Session
                                H. R. 2401

    To modify the antitrust exemption applicable to the business of 
                               insurance.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                              May 17, 2005

Mr. DeFazio (for himself, Mr. Baird, Mrs. Christensen, Mr. Crowley, Mr. 
Hinchey, and Mr. Taylor of Mississippi) introduced the following bill; 
          which was referred to the Committee on the Judiciary

_______________________________________________________________________

                                 A BILL


 
    To modify the antitrust exemption applicable to the business of 
                               insurance.

    Be it enacted by the Senate and House of Representatives 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 
2005''.

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-Ferguson 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 unlawful 
                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 geographical 
                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 product; or
                    ``(D) monopolizing, or attempting to monopolize, 
                any part of the business of insurance.'', 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 combination or conspiracy--
            ``(1) to collect, compile, or disseminate historical loss 
        data;
            ``(2) to determine a loss development factor applicable to 
        historical loss data; or
            ``(3) to perform actuarial services if such contract, 
        combination, or conspiracy does not involve a restraint of 
        trade.
    ``(d) The conduct referred to in subsection (b)(2) shall not 
include making a contract, or engaging in a combination or conspiracy, 
to determine a trend factor--
            ``(1) during the transition period; and
            ``(2) in the case of a person with a policyholders' surplus 
        of less than $10,000,000 or a policyholders' surplus of less 
        than $100,000,000 and whose direct written insurance premiums 
        for the line of business in question constitutes less than a 
        2.5 percent share of the total market in the most recently 
        ended 1-year period in every jurisdiction in which the person 
        is engaged in the business of insurance and which is not more 
        than 50 percent owned or controlled by another person engaged 
        in the business of insurance and which does not, together with 
        other persons engaging in such conduct have, in the aggregate, 
        in the then most recently completed 1-year period, 20 percent 
        or more of the relevant market in the line of insurance 
        involved.
    ``(e) For purposes of this section--
            ``(1) the term `historical loss data' means information 
        respecting claims paid, or reserves held for claims reported, 
        by any person engaged in the business 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 effective 
                date of the Insurance Competitive Pricing Act of 2005, 
                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 insurance;
                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 adjustment to be 
        made to losses incurred for claims reported by any person 
        engaged in the business of insurance, to reflect a change in 
        inflation or any other change in the estimated loss costs 
        incurred by persons 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.
                                 <all>