[Congressional Record (Bound Edition), Volume 161 (2015), Part 1]
[Senate]
[Pages 250-257]
[From the U.S. Government Publishing Office, www.gpo.gov]




                           TEXT OF AMENDMENTS

  SA 1. Ms. WARREN (for herself and Mr. Schumer) proposed an amendment 
to the bill H.R. 26, to extend the termination date of the Terrorism 
Insurance Program established under the Terrorism Risk Insurance Act of 
2002, and for other purposes; as follows:

       Strike all after the enacting clause and insert the 
     following:

     SECTION 1. SHORT TITLE AND TABLE OF CONTENTS.

       (a) Short Title.--This Act may be cited as the ``Terrorism 
     Risk Insurance Program Reauthorization Act of 2015''.
       (b) Table of Contents.--The table of contents for this Act 
     is as follows:

Sec. 1. Short title and table of contents.

           TITLE I--EXTENSION OF TERRORISM INSURANCE PROGRAM

Sec. 101. Extension of Terrorism Insurance Program.
Sec. 102. Federal share.
Sec. 103. Program trigger.
Sec. 104. Recoupment of Federal share of compensation under the 
              program.
Sec. 105. Certification of acts of terrorism; consultation with 
              Secretary of Homeland Security.
Sec. 106. Technical amendments.
Sec. 107. Improving the certification process.
Sec. 108. GAO study.
Sec. 109. Membership of Board of Governors of the Federal Reserve 
              System.
Sec. 110. Advisory Committee on Risk-Sharing Mechanisms.
Sec. 111. Reporting of terrorism insurance data.
Sec. 112. Annual study of small insurer market competitiveness.

 TITLE II--NATIONAL ASSOCIATION OF REGISTERED AGENTS AND BROKERS REFORM

Sec. 201. Short title.
Sec. 202. Reestablishment of the National Association of Registered 
              Agents and Brokers.

           TITLE I--EXTENSION OF TERRORISM INSURANCE PROGRAM

     SEC. 101. EXTENSION OF TERRORISM INSURANCE PROGRAM.

       Section 108(a) of the Terrorism Risk Insurance Act of 2002 
     (15 U.S.C. 6701 note) is amended by striking ``December 31, 
     2014'' and inserting ``December 31, 2020''.

     SEC. 102. FEDERAL SHARE.

       Section 103(e)(1)(A) of the Terrorism Risk Insurance Act of 
     2002 (15 U.S.C. 6701 note) is amended by inserting ``and 
     beginning on January 1, 2016, shall decrease by 1 percentage 
     point per calendar year until equal to 80 percent'' after 
     ``85 percent''.

     SEC. 103. PROGRAM TRIGGER.

       Subparagraph (B) of section 103(e)(1) (15 U.S.C. 6701 note) 
     is amended in the matter preceding clause (i)--
       (1) by striking ``a certified act'' and inserting 
     ``certified acts'';
       (2) by striking ``such certified act'' and inserting ``such 
     certified acts''; and
       (3) by striking ``exceed'' and all that follows through 
     clause (ii) and inserting the following: ``exceed--
       ``(i) $100,000,000, with respect to such insured losses 
     occurring in calendar year 2015;
       ``(ii) $120,000,000, with respect to such insured losses 
     occurring in calendar year 2016;
       ``(iii) $140,000,000, with respect to such insured losses 
     occurring in calendar year 2017;
       ``(iv) $160,000,000, with respect to such insured losses 
     occurring in calendar year 2018;
       ``(v) $180,000,000, with respect to such insured losses 
     occurring in calendar year 2019; and
       ``(vi) $200,000,000, with respect to such insured losses 
     occurring in calendar year 2020 and any calendar year 
     thereafter.''.

     SEC. 104. RECOUPMENT OF FEDERAL SHARE OF COMPENSATION UNDER 
                   THE PROGRAM.

       Section 103(e) of the Terrorism Risk Insurance Act of 2002 
     (15 U.S.C. 6701 note) is amended--
       (1) by amending paragraph (6) to read as follows:
       ``(6) Insurance marketplace aggregate retention amount.--
       ``(A) In general.--For purposes of paragraph (7), the 
     insurance marketplace aggregate retention amount shall be the 
     lesser of--
       ``(i) $27,500,000,000, as such amount is revised pursuant 
     to this paragraph; and
       ``(ii) the aggregate amount, for all insurers, of insured 
     losses during such calendar year.
       ``(B) Revision of insurance marketplace aggregate retention 
     amount.--
       ``(i) Phase-in.--Beginning in the calendar year of 
     enactment of the Terrorism Risk Insurance Program 
     Reauthorization Act of 2015, the amount set forth under 
     subparagraph (A)(i) shall increase by $2,000,000,000 per 
     calendar year until equal to $37,500,000,000.
       ``(ii) Further revision.--Beginning in the calendar year 
     that follows the calendar year in which the amount set forth 
     under subparagraph (A)(i) is equal to $37,500,000,000, the 
     amount under subparagraph (A)(i) shall be revised to be the 
     amount equal to the annual average of the sum of insurer 
     deductibles for all insurers participating in the Program for 
     the prior 3 calendar years, as such sum is determined by the 
     Secretary under subparagraph (C).
       ``(C) Rulemaking.--Not later than 3 years after the date of 
     enactment of the Terrorism Risk Insurance Program 
     Reauthorization Act of 2015, the Secretary shall--
       ``(i) issue final rules for determining the amount of the 
     sum described under subparagraph (B)(ii); and
       ``(ii) provide a timeline for public notification of such 
     determination.''; and
       (2) in paragraph (7)--
       (A) in subparagraph (A)--
       (i) in the matter preceding clause (i), by striking ``for 
     each of the periods referred to in subparagraphs (A) through 
     (E) of paragraph (6)''; and
       (ii) in clause (i), by striking ``for such period'';
       (B) by striking subparagraph (B) and inserting the 
     following:
       ``(B) [Reserved.]'';
       (C) in subparagraph (C)--
       (i) by striking ``occurring during any of the periods 
     referred to in any of subparagraphs (A) through (E) of 
     paragraph (6), terrorism loss risk-spreading premiums in an 
     amount equal to 133 percent'' and inserting ``, terrorism 
     loss risk-spreading premiums in an amount equal to 140 
     percent''; and
       (ii) by inserting ``as calculated under subparagraph (A)'' 
     after ``mandatory recoupment amount''; and
       (D) in subparagraph (E)(i)--
       (i) in subclause (I)--

       (I) by striking ``2010'' and inserting ``2017''; and
       (II) by striking ``2012'' and inserting ``2019'';

       (ii) in subclause (II)--

       (I) by striking ``2011'' and inserting ``2018'';
       (II) by striking ``2012'' and inserting ``2019''; and
       (III) by striking ``2017'' and inserting ``2024''; and

       (iii) in subclause (III)--

       (I) by striking ``2012'' and inserting ``2019''; and
       (II) by striking ``2017'' and inserting ``2024''.

     SEC. 105. CERTIFICATION OF ACTS OF TERRORISM; CONSULTATION 
                   WITH SECRETARY OF HOMELAND SECURITY.

       Paragraph (1)(A) of section 102 (15 U.S.C. 6701 note) is 
     amended in the matter preceding clause (i), by striking 
     ``concurrence with the Secretary of State'' and inserting 
     ``consultation with the Secretary of Homeland Security''.

     SEC. 106. TECHNICAL AMENDMENTS.

       The Terrorism Risk Insurance Act of 2002 (15 U.S.C. 6701 
     note) is amended--
       (1) in section 102--
       (A) in paragraph (3)--
       (i) by redesignating subparagraphs (A), (B), and (C) as 
     clauses (i), (ii), and (iii), respectively;
       (ii) in the matter preceding clause (i) (as so 
     redesignated), by striking ``An entity has'' and inserting 
     the following:
       ``(A) In general.--An entity has''; and
       (iii) by adding at the end the following new subparagraph:
       ``(B) Rule of construction.--An entity, including any 
     affiliate thereof, does not have `control' over another 
     entity, if, as of the date of enactment of the Terrorism Risk 
     Insurance Program Reauthorization Act of 2015, the entity is 
     acting as an attorney-in-fact, as defined by the Secretary, 
     for the other entity and such other entity is a reciprocal 
     insurer, provided that the entity is not,

[[Page 251]]

     for reasons other than the attorney-in-fact relationship, 
     defined as having `control' under subparagraph (A).'';
       (B) in paragraph (7)--
       (i) by striking subparagraphs (A) through (F) and inserting 
     the following:
       ``(A) the value of an insurer's direct earned premiums 
     during the immediately preceding calendar year, multiplied by 
     20 percent; and'';
       (ii) by redesignating subparagraph (G) as subparagraph (B); 
     and
       (iii) in subparagraph (B), as so redesignated by clause 
     (ii)--

       (I) by striking ``notwithstanding subparagraphs (A) through 
     (F), for the Transition Period or any Program Year'' and 
     inserting ``notwithstanding subparagraph (A), for any 
     calendar year''; and
       (II) by striking ``Period or Program Year'' and inserting 
     ``calendar year'';

       (C) by striking paragraph (11); and
       (D) by redesignating paragraphs (12) through (16) as 
     paragraphs (11) through (15), respectively; and
       (2) in section 103--
       (A) in subsection (b)(2)--
       (i) in subparagraph (B), by striking ``, purchase,''; and
       (ii) in subparagraph (C), by striking ``, purchase,'';
       (B) in subsection (c), by striking ``Program Year'' and 
     inserting ``calendar year'';
       (C) in subsection (e)--
       (i) in paragraph (1)(A), as previously amended by section 
     102--

       (I) by striking ``the Transition Period and each Program 
     Year through Program Year 4 shall be equal to 90 percent, and 
     during Program Year 5 and each Program Year thereafter'' and 
     inserting ``each calendar year'';
       (II) by striking the comma after ``80 percent''; and
       (III) by striking ``such Transition Period or such Program 
     Year'' and inserting ``such calendar year''; and

       (ii) in paragraph (2)(A), by striking ``the period 
     beginning on the first day of the Transition Period and 
     ending on the last day of Program Year 1, or during any 
     Program Year thereafter'' and inserting ``a calendar year''; 
     and
       (iii) in paragraph (3), by striking ``the period beginning 
     on the first day of the Transition Period and ending on the 
     last day of Program Year 1, or during any other Program 
     Year'' and inserting ``any calendar year''; and
       (D) in subsection (g)(2)--
       (i) by striking ``the Transition Period or a Program Year'' 
     each place that term appears and inserting ``the calendar 
     year'';
       (ii) by striking ``such period'' and inserting ``the 
     calendar year''; and
       (iii) by striking ``that period'' and inserting ``the 
     calendar year''.

     SEC. 107. IMPROVING THE CERTIFICATION PROCESS.

       (a) Definitions.--As used in this section--
       (1) the term ``act of terrorism'' has the same meaning as 
     in section 102(1) of the Terrorism Risk Insurance Act of 2002 
     (15 U.S.C. 6701 note);
       (2) the term ``certification process'' means the process by 
     which the Secretary determines whether to certify an act as 
     an act of terrorism under section 102(1) of the Terrorism 
     Risk Insurance Act of 2002 (15 U.S.C. 6701 note); and
       (3) the term ``Secretary'' means the Secretary of the 
     Treasury.
       (b) Study.--Not later than 9 months after the date of 
     enactment of this Act, the Secretary shall conduct and 
     complete a study on the certification process.
       (c) Required Content.--The study required under subsection 
     (a) shall include an examination and analysis of--
       (1) the establishment of a reasonable timeline by which the 
     Secretary must make an accurate determination on whether to 
     certify an act as an act of terrorism;
       (2) the impact that the length of any timeline proposed to 
     be established under paragraph (1) may have on the insurance 
     industry, policyholders, consumers, and taxpayers as a whole;
       (3) the factors the Secretary would evaluate and monitor 
     during the certification process, including the ability of 
     the Secretary to obtain the required information regarding 
     the amount of projected and incurred losses resulting from an 
     act which the Secretary would need in determining whether to 
     certify the act as an act of terrorism;
       (4) the appropriateness, efficiency, and effectiveness of 
     the consultation process required under section 102(1)(A) of 
     the Terrorism Risk Insurance Act of 2002 (15 U.S.C. 6701 
     note) and any recommendations on changes to the consultation 
     process; and
       (5) the ability of the Secretary to provide guidance and 
     updates to the public regarding any act that may reasonably 
     be certified as an act of terrorism.
       (d) Report.--Upon completion of the study required under 
     subsection (a), the Secretary shall submit a report on the 
     results of such study to the Committee on Banking, Housing, 
     and Urban Affairs of the Senate and the Committee on 
     Financial Services of the House of Representatives.
       (e) Rulemaking.--Section 102(1) of the Terrorism Risk 
     Insurance Act of 2002 (15 U.S.C. 6701 note) is amended--
       (1) by redesignating subparagraph (D) as subparagraph (E); 
     and
       (2) by inserting after subparagraph (C) the following:
       ``(D) Timing of certification.--Not later than 9 months 
     after the report required under section 107 of the Terrorism 
     Risk Insurance Program Reauthorization Act of 2015 is 
     submitted to the appropriate committees of Congress, the 
     Secretary shall issue final rules governing the certification 
     process, including establishing a timeline for which an act 
     is eligible for certification by the Secretary on whether an 
     act is an act of terrorism under this paragraph.''.

     SEC. 108. GAO STUDY.

       (a) Study.--Not later than 2 years after the date of 
     enactment of this Act, the Comptroller General of the United 
     States shall complete a study on the viability and effects of 
     the Federal Government--
       (1) assessing and collecting upfront premiums on insurers 
     that participate in the Terrorism Insurance Program 
     established under the Terrorism Risk Insurance Act of 2002 
     (15 U.S.C. 6701 note) (hereafter in this section referred to 
     as the ``Program''), which shall include a comparison of 
     practices in international markets to assess and collect 
     premiums either before or after terrorism losses are 
     incurred; and
       (2) creating a capital reserve fund under the Program and 
     requiring insurers participating in the Program to dedicate 
     capital specifically for terrorism losses before such losses 
     are incurred, which shall include a comparison of practices 
     in international markets to establish reserve funds.
       (b) Required Content.--The study required under subsection 
     (a) shall examine, but shall not be limited to, the following 
     issues:
       (1) Upfront premiums.--With respect to upfront premiums 
     described in subsection (a)(1)--
       (A) how the Federal Government could determine the price of 
     such upfront premiums on insurers that participate in the 
     Program;
       (B) how the Federal Government could collect and manage 
     such upfront premiums;
       (C) how the Federal Government could ensure that such 
     upfront premiums are not spent for purposes other than claims 
     through the Program;
       (D) how the assessment and collection of such upfront 
     premiums could affect take-up rates for terrorism risk 
     coverage in different regions and industries and how it could 
     impact small businesses and consumers in both metropolitan 
     and non-metropolitan areas;
       (E) the effect of collecting such upfront premiums on 
     insurers both large and small;
       (F) the effect of collecting such upfront premiums on the 
     private market for terrorism risk reinsurance; and
       (G) the size of any Federal Government subsidy insurers may 
     receive through their participation in the Program, taking 
     into account the Program's current post-event recoupment 
     structure.
       (2) Capital reserve fund.--With respect to the capital 
     reserve fund described in subsection (a)(2)--
       (A) how the creation of a capital reserve fund would affect 
     the Federal Government's fiscal exposure under the Terrorism 
     Risk Insurance Program and the ability of the Program to meet 
     its statutory purposes;
       (B) how a capital reserve fund would impact insurers and 
     reinsurers, including liquidity, insurance pricing, and 
     capacity to provide terrorism risk coverage;
       (C) the feasibility of segregating funds attributable to 
     terrorism risk from funds attributable to other insurance 
     lines;
       (D) how a capital reserve fund would be viewed and treated 
     under current Financial Accounting Standards Board accounting 
     rules and the tax laws; and
       (E) how a capital reserve fund would affect the States' 
     ability to regulate insurers participating in the Program.
       (3) International practices.--With respect to international 
     markets referred to in paragraphs (1) and (2) of subsection 
     (a), how other countries, if any--
       (A) have established terrorism insurance structures;
       (B) charge premiums or otherwise collect funds to pay for 
     the costs of terrorism insurance structures, including risk 
     and administrative costs; and
       (C) have established capital reserve funds to pay for the 
     costs of terrorism insurance structures.
       (c) Report.--Upon completion of the study required under 
     subsection (a), the Comptroller General shall submit a report 
     on the results of such study to the Committee on Banking, 
     Housing, and Urban Affairs of the Senate and the Committee on 
     Financial Services of the House of Representatives.
       (d) Public Availability.--The study and report required 
     under this section shall be made available to the public in 
     electronic form and shall be published on the website of the 
     Government Accountability Office.

     SEC. 109. MEMBERSHIP OF BOARD OF GOVERNORS OF THE FEDERAL 
                   RESERVE SYSTEM.

       (a) In General.--The first undesignated paragraph of 
     section 10 of the Federal Reserve Act (12 U.S.C. 241) is 
     amended by inserting after the second sentence the following: 
     ``In selecting members of the Board, the President shall 
     appoint at least 1 member with demonstrated primary 
     experience working in or supervising community banks having 
     less than $10,000,000,000 in total assets.''.

[[Page 252]]

       (b) Effective Date.--The amendment made by this section 
     shall take effect on the date of enactment of this Act and 
     apply to appointments made on and after that effective date, 
     excluding any nomination pending in the Senate on that date.

     SEC. 110. ADVISORY COMMITTEE ON RISK-SHARING MECHANISMS.

       (a) Finding; Rule of Construction.--
       (1) Finding.--Congress finds that it is desirable to 
     encourage the growth of nongovernmental, private market 
     reinsurance capacity for protection against losses arising 
     from acts of terrorism.
       (2) Rule of construction.--Nothing in this Act, any 
     amendment made by this Act, or the Terrorism Risk Insurance 
     Act of 2002 (15 U.S.C. 6701 note) shall prohibit insurers 
     from developing risk-sharing mechanisms to voluntarily 
     reinsure terrorism losses between and among themselves.
       (b) Advisory Committee on Risk-Sharing Mechanisms.--
       (1) Establishment.--The Secretary of the Treasury shall 
     establish and appoint an advisory committee to be known as 
     the ``Advisory Committee on Risk-Sharing Mechanisms'' 
     (referred to in this subsection as the ``Advisory 
     Committee'').
       (2) Duties.--The Advisory Committee shall provide advice, 
     recommendations, and encouragement with respect to the 
     creation and development of the nongovernmental risk-sharing 
     mechanisms described under subsection (a).
       (3) Membership.--The Advisory Committee shall be composed 
     of 9 members who are directors, officers, or other employees 
     of insurers, reinsurers, or capital market participants that 
     are participating or that desire to participate in the 
     nongovernmental risk-sharing mechanisms described under 
     subsection (a), and who are representative of the affected 
     sectors of the insurance industry, including commercial 
     property insurance, commercial casualty insurance, 
     reinsurance, and alternative risk transfer industries.

     SEC. 111. REPORTING OF TERRORISM INSURANCE DATA.

       Section 104 (15 U.S.C. 6701 note) is amended by adding at 
     the end the following new subsection:
       ``(h) Reporting of Terrorism Insurance Data.--
       ``(1) Authority.--During the calendar year beginning on 
     January 1, 2016, and in each calendar year thereafter, the 
     Secretary shall require insurers participating in the Program 
     to submit to the Secretary such information regarding 
     insurance coverage for terrorism losses of such insurers as 
     the Secretary considers appropriate to analyze the 
     effectiveness of the Program, which shall include information 
     regarding--
       ``(A) lines of insurance with exposure to such losses;
       ``(B) premiums earned on such coverage;
       ``(C) geographical location of exposures;
       ``(D) pricing of such coverage;
       ``(E) the take-up rate for such coverage;
       ``(F) the amount of private reinsurance for acts of 
     terrorism purchased; and
       ``(G) such other matters as the Secretary considers 
     appropriate.
       ``(2) Reports.--Not later than June 30, 2016, and every 
     other June 30 thereafter, the Secretary shall submit a report 
     to the Committee on Financial Services of the House of 
     Representatives and the Committee on Banking, Housing, and 
     Urban Affairs of the Senate that includes--
       ``(A) an analysis of the overall effectiveness of the 
     Program;
       ``(B) an evaluation of any changes or trends in the data 
     collected under paragraph (1);
       ``(C) an evaluation of whether any aspects of the Program 
     have the effect of discouraging or impeding insurers from 
     providing commercial property casualty insurance coverage or 
     coverage for acts of terrorism;
       ``(D) an evaluation of the impact of the Program on 
     workers' compensation insurers; and
       ``(E) in the case of the data reported in paragraph (1)(B), 
     an updated estimate of the total amount earned since January 
     1, 2003.
       ``(3) Protection of data.--To the extent possible, the 
     Secretary shall contract with an insurance statistical 
     aggregator to collect the information described in paragraph 
     (1), which shall keep any nonpublic information confidential 
     and provide it to the Secretary in an aggregate form or in 
     such other form or manner that does not permit identification 
     of the insurer submitting such information.
       ``(4) Advance coordination.--Before collecting any data or 
     information under paragraph (1) from an insurer, or affiliate 
     of an insurer, the Secretary shall coordinate with the 
     appropriate State insurance regulatory authorities and any 
     relevant government agency or publicly available sources to 
     determine if the information to be collected is available 
     from, and may be obtained in a timely manner by, individually 
     or collectively, such entities. If the Secretary determines 
     that such data or information is available, and may be 
     obtained in a timely matter, from such entities, the 
     Secretary shall obtain the data or information from such 
     entities. If the Secretary determines that such data or 
     information is not so available, the Secretary may collect 
     such data or information from an insurer and affiliates.
       ``(5) Confidentiality.--
       ``(A) Retention of privilege.--The submission of any non-
     publicly available data and information to the Secretary and 
     the sharing of any non-publicly available data with or by the 
     Secretary among other Federal agencies, the State insurance 
     regulatory authorities, or any other entities under this 
     subsection shall not constitute a waiver of, or otherwise 
     affect, any privilege arising under Federal or State law 
     (including the rules of any Federal or State court) to which 
     the data or information is otherwise subject.
       ``(B) Continued application of prior confidentiality 
     agreements.--Any requirement under Federal or State law to 
     the extent otherwise applicable, or any requirement pursuant 
     to a written agreement in effect between the original source 
     of any non-publicly available data or information and the 
     source of such data or information to the Secretary, 
     regarding the privacy or confidentiality of any data or 
     information in the possession of the source to the Secretary, 
     shall continue to apply to such data or information after the 
     data or information has been provided pursuant to this 
     subsection.
       ``(C) Information-sharing agreement.--Any data or 
     information obtained by the Secretary under this subsection 
     may be made available to State insurance regulatory 
     authorities, individually or collectively through an 
     information-sharing agreement that--
       ``(i) shall comply with applicable Federal law; and
       ``(ii) shall not constitute a waiver of, or otherwise 
     affect, any privilege under Federal or State law (including 
     any privilege referred to in subparagraph (A) and the rules 
     of any Federal or State court) to which the data or 
     information is otherwise subject.
       ``(D) Agency disclosure requirements.--Section 552 of title 
     5, United States Code, including any exceptions thereunder, 
     shall apply to any data or information submitted under this 
     subsection to the Secretary by an insurer or affiliate of an 
     insurer.''.

     SEC. 112. ANNUAL STUDY OF SMALL INSURER MARKET 
                   COMPETITIVENESS.

       Section 108 (15 U.S.C. 6701 note) is amended by adding at 
     the end the following new subsection:
       ``(h) Study of Small Insurer Market Competitiveness.--
       ``(1) In general.--Not later than June 30, 2017, and every 
     other June 30 thereafter, the Secretary shall conduct a study 
     of small insurers (as such term is defined by regulation by 
     the Secretary) participating in the Program, and identify any 
     competitive challenges small insurers face in the terrorism 
     risk insurance marketplace, including--
       ``(A) changes to the market share, premium volume, and 
     policyholder surplus of small insurers relative to large 
     insurers;
       ``(B) how the property and casualty insurance market for 
     terrorism risk differs between small and large insurers, and 
     whether such a difference exists within other perils;
       ``(C) the impact of the Program's mandatory availability 
     requirement under section 103(c) on small insurers;
       ``(D) the effect of increasing the trigger amount for the 
     Program under section 103(e)(1)(B) on small insurers;
       ``(E) the availability and cost of private reinsurance for 
     small insurers; and
       ``(F) the impact that State workers compensation laws have 
     on small insurers and workers compensation carriers in the 
     terrorism risk insurance marketplace.
       ``(2) Report.--The Secretary shall submit a report to the 
     Congress setting forth the findings and conclusions of each 
     study required under paragraph (1).''.

 TITLE II--NATIONAL ASSOCIATION OF REGISTERED AGENTS AND BROKERS REFORM

     SEC. 201. SHORT TITLE.

       This title may be cited as the ``National Association of 
     Registered Agents and Brokers Reform Act of 2015''.

     SEC. 202. REESTABLISHMENT OF THE NATIONAL ASSOCIATION OF 
                   REGISTERED AGENTS AND BROKERS.

       (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 National 
     Association of Registered Agents and Brokers (referred to in 
     this subtitle as the `Association').
       ``(b) Status.--The Association shall--
       ``(1) be a nonprofit corporation;
       ``(2) not be an agent or instrumentality of the Federal 
     Government;
       ``(3) be an independent organization that may not be merged 
     with or into any other private or public entity; and
       ``(4) except as otherwise provided in this subtitle, be 
     subject to, and have all the powers conferred upon, a 
     nonprofit corporation by the District of Columbia Nonprofit 
     Corporation Act (D.C. Code, sec. 29-301.01 et seq.) or any 
     successor thereto.

     ``SEC. 322. PURPOSE.

       ``The purpose of the Association shall be to provide a 
     mechanism through which licensing, continuing education, and 
     other nonresident insurance producer qualification 
     requirements and conditions may be adopted

[[Page 253]]

     and applied on a multi-state basis without affecting the 
     laws, rules, and regulations, and preserving the rights of a 
     State, pertaining to--
       ``(1) licensing, continuing education, and other 
     qualification requirements of insurance producers that are 
     not members of the Association;
       ``(2) resident or nonresident insurance producer 
     appointment requirements;
       ``(3) supervising and disciplining resident and nonresident 
     insurance producers;
       ``(4) establishing licensing fees for resident and 
     nonresident insurance producers so that there is no loss of 
     insurance producer licensing revenue to the State; and
       ``(5) prescribing and enforcing laws and regulations 
     regulating the conduct of resident and nonresident insurance 
     producers.

     ``SEC. 323. MEMBERSHIP.

       ``(a) Eligibility.--
       ``(1) In general.--Any insurance producer licensed in its 
     home State shall, subject to paragraphs (2) and (4), be 
     eligible to become a member of the Association.
       ``(2) Ineligibility for suspension or revocation of 
     license.--Subject to paragraph (3), an insurance producer is 
     not eligible to become a member of the Association if a State 
     insurance regulator has suspended or revoked the insurance 
     license of the insurance producer in that State.
       ``(3) Resumption of eligibility.--Paragraph (2) shall cease 
     to apply to any insurance producer if--
       ``(A) the State insurance regulator reissues or renews the 
     license of the insurance producer in the State in which the 
     license was suspended or revoked, or otherwise terminates or 
     vacates the suspension or revocation; or
       ``(B) the suspension or revocation expires or is 
     subsequently overturned by a court of competent jurisdiction.
       ``(4) Criminal history record check required.--
       ``(A) In general.--An insurance producer who is an 
     individual shall not be eligible to become a member of the 
     Association unless the insurance producer has undergone a 
     criminal history record check that complies with regulations 
     prescribed by the Attorney General of the United States under 
     subparagraph (K).
       ``(B) Criminal history record check requested by home 
     state.--An insurance producer who is licensed in a State and 
     who has undergone a criminal history record check during the 
     2-year period preceding the date of submission of an 
     application to become a member of the Association, in 
     compliance with a requirement to undergo such criminal 
     history record check as a condition for such licensure in the 
     State, shall be deemed to have undergone a criminal history 
     record check for purposes of subparagraph (A).
       ``(C) Criminal history record check requested by 
     association.--
       ``(i) In general.--The Association shall, upon request by 
     an insurance producer licensed in a State, submit 
     fingerprints or other identification information obtained 
     from the insurance producer, and a request for a criminal 
     history record check of the insurance producer, to the 
     Federal Bureau of Investigation.
       ``(ii) Procedures.--The board of directors of the 
     Association (referred to in this subtitle as the `Board') 
     shall prescribe procedures for obtaining and utilizing 
     fingerprints or other identification information and criminal 
     history record information, including the establishment of 
     reasonable fees to defray the expenses of the Association in 
     connection with the performance of a criminal history record 
     check and appropriate safeguards for maintaining 
     confidentiality and security of the information. Any fees 
     charged pursuant to this clause shall be separate and 
     distinct from those charged by the Attorney General pursuant 
     to subparagraph (I).
       ``(D) Form of request.--A submission under subparagraph 
     (C)(i) shall include such fingerprints or other 
     identification information as is required by the Attorney 
     General concerning the person about whom the criminal history 
     record check is requested, and a statement signed by the 
     person authorizing the Attorney General to provide the 
     information to the Association and for the Association to 
     receive the information.
       ``(E) Provision of information by attorney general.--Upon 
     receiving a submission under subparagraph (C)(i) from the 
     Association, the Attorney General shall search all criminal 
     history records of the Federal Bureau of Investigation, 
     including records of the Criminal Justice Information 
     Services Division of the Federal Bureau of Investigation, 
     that the Attorney General determines appropriate for criminal 
     history records corresponding to the fingerprints or other 
     identification information provided under subparagraph (D) 
     and provide all criminal history record information included 
     in the request to the Association.
       ``(F) Limitation on permissible uses of information.--Any 
     information provided to the Association under subparagraph 
     (E) may only--
       ``(i) be used for purposes of determining compliance with 
     membership criteria established by the Association;
       ``(ii) be disclosed to State insurance regulators, or 
     Federal or State law enforcement agencies, in conformance 
     with applicable law; or
       ``(iii) be disclosed, upon request, to the insurance 
     producer to whom the criminal history record information 
     relates.
       ``(G) Penalty for improper use or disclosure.--Whoever 
     knowingly uses any information provided under subparagraph 
     (E) for a purpose not authorized in subparagraph (F), or 
     discloses any such information to anyone not authorized to 
     receive it, shall be fined not more than $50,000 per 
     violation as determined by a court of competent jurisdiction.
       ``(H) Reliance on information.--Neither the Association nor 
     any of its Board members, officers, or employees shall be 
     liable in any action for using information provided under 
     subparagraph (E) as permitted under subparagraph (F) in good 
     faith and in reasonable reliance on its accuracy.
       ``(I) Fees.--The Attorney General may charge a reasonable 
     fee for conducting the search and providing the information 
     under subparagraph (E), and any such fee shall be collected 
     and remitted by the Association to the Attorney General.
       ``(J) Rule of construction.--Nothing in this paragraph 
     shall be construed as--
       ``(i) requiring a State insurance regulator to perform 
     criminal history record checks under this section; or
       ``(ii) limiting any other authority that allows access to 
     criminal history records.
       ``(K) Regulations.--The Attorney General shall prescribe 
     regulations to carry out this paragraph, which shall 
     include--
       ``(i) appropriate protections for ensuring the 
     confidentiality of information provided under subparagraph 
     (E); and
       ``(ii) procedures providing a reasonable opportunity for an 
     insurance producer to contest the accuracy of information 
     regarding the insurance producer provided under subparagraph 
     (E).
       ``(L) Ineligibility for membership.--
       ``(i) In general.--The Association may, under reasonably 
     consistently applied standards, deny membership to an 
     insurance producer on the basis of criminal history record 
     information provided under subparagraph (E), or where the 
     insurance producer has been subject to disciplinary action, 
     as described in paragraph (2).
       ``(ii) Rights of applicants denied membership.--The 
     Association shall notify any insurance producer who is denied 
     membership on the basis of criminal history record 
     information provided under subparagraph (E) of the right of 
     the insurance producer to--

       ``(I) obtain a copy of all criminal history record 
     information provided to the Association under subparagraph 
     (E) with respect to the insurance producer; and
       ``(II) challenge the denial of membership based on the 
     accuracy and completeness of the information.

       ``(M) Definition.--For purposes of this paragraph, the term 
     `criminal history record check' means a national background 
     check of criminal history records of the Federal Bureau of 
     Investigation.
       ``(b) Authority to Establish Membership Criteria.--The 
     Association may establish membership criteria that bear a 
     reasonable relationship to the purposes for which the 
     Association was established.
       ``(c) Establishment of Classes and Categories of 
     Membership.--
       ``(1) Classes of membership.--The Association may establish 
     separate classes of membership, with separate criteria, if 
     the Association reasonably determines that performance of 
     different duties requires different levels of education, 
     training, experience, or other qualifications.
       ``(2) Business entities.--The Association shall establish a 
     class of membership and membership criteria for business 
     entities. A business entity that applies for membership shall 
     be required to designate an individual Association member 
     responsible for the compliance of the business entity with 
     Association standards and the insurance laws, standards, and 
     regulations of any State in which the business entity seeks 
     to do business on the basis of Association membership.
       ``(3) Categories.--
       ``(A) Separate categories for insurance producers 
     permitted.--The Association may establish separate categories 
     of membership for insurance producers and for other persons 
     or entities within each class, based on the types of 
     licensing categories that exist under State laws.
       ``(B) Separate treatment for depository institutions 
     prohibited.--No special categories of membership, and no 
     distinct membership criteria, shall be established for 
     members that are depository institutions or for employees, 
     agents, or affiliates of depository institutions.
       ``(d) Membership Criteria.--
       ``(1) In general.--The Association may establish criteria 
     for membership which shall include standards for personal 
     qualifications, education, training, and experience. The 
     Association shall not establish criteria that unfairly limit 
     the ability of a small insurance producer to become a member 
     of the Association, including imposing discriminatory 
     membership fees.
       ``(2) Qualifications.--In establishing criteria under 
     paragraph (1), the Association shall not adopt any 
     qualification less protective to the public than that 
     contained in the

[[Page 254]]

     National Association of Insurance Commissioners (referred to 
     in this subtitle as the `NAIC') Producer Licensing Model Act 
     in effect as of the date of enactment of the National 
     Association of Registered Agents and Brokers Reform Act of 
     2015, and shall consider the highest levels of insurance 
     producer qualifications 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 investigating and evaluating the 
     eligibility of a prospective member for membership in the 
     Association.
       ``(B) Authorization of information sharing.--A submission 
     under subsection (a)(4)(C)(i) made by an insurance producer 
     licensed in a State shall include a statement signed by the 
     person about whom the assistance is requested authorizing--
       ``(i) the State to share information with the Association; 
     and
       ``(ii) the Association to receive the information.
       ``(C) Rule of construction.--Subparagraph (A) shall not be 
     construed as requiring or authorizing any State to adopt new 
     or additional requirements concerning the licensing or 
     evaluation of insurance producers.
       ``(4) Denial of membership.--The Association may, based on 
     reasonably consistently applied standards, deny membership to 
     any State-licensed insurance producer for failure to meet the 
     membership criteria established by the Association.
       ``(e) Effect of Membership.--
       ``(1) Authority of association members.--Membership in the 
     Association shall--
       ``(A) authorize an insurance producer to sell, solicit, or 
     negotiate insurance in any State for which the member pays 
     the licensing fee set by the State for any line or lines of 
     insurance specified in the home State license of the 
     insurance producer, and exercise all such incidental powers 
     as shall be necessary to carry out such activities, including 
     claims adjustments and settlement to the extent permissible 
     under the laws of the State, risk management, employee 
     benefits advice, retirement planning, and any other 
     insurance-related consulting activities;
       ``(B) be the equivalent of a nonresident insurance producer 
     license for purposes of authorizing the insurance producer to 
     engage in the activities described in subparagraph (A) in any 
     State where the member pays the licensing fee; and
       ``(C) be the equivalent of a nonresident insurance producer 
     license for the purpose of subjecting an insurance producer 
     to all laws, regulations, provisions or other action of any 
     State concerning revocation, suspension, or other enforcement 
     action related to the ability of a member to engage in any 
     activity within the scope of authority granted under this 
     subsection and to all State laws, regulations, provisions, 
     and actions preserved under paragraph (5).
       ``(2) Violent crime control and law enforcement act of 
     1994.--Nothing in this subtitle shall be construed to alter, 
     modify, or supercede any requirement established by section 
     1033 of title 18, United States Code.
       ``(3) Agent for remitting fees.--The Association shall act 
     as an agent for any member for purposes of remitting 
     licensing fees to any State pursuant to paragraph (1).
       ``(4) Notification of action.--
       ``(A) In general.--The Association shall notify the States 
     (including State insurance regulators) and the NAIC when an 
     insurance producer has satisfied the membership criteria of 
     this section. The States (including State insurance 
     regulators) shall have 10 business days after the date of the 
     notification in order to provide the Association with 
     evidence that the insurance producer does not satisfy the 
     criteria for membership in the Association.
       ``(B) Ongoing disclosures required.--On an ongoing basis, 
     the Association shall disclose to the States (including State 
     insurance regulators) and the NAIC a list of the States in 
     which each member is authorized to operate. The Association 
     shall immediately notify the States (including State 
     insurance regulators) and the NAIC when a member is newly 
     authorized to operate in one or more States, or is no longer 
     authorized to operate in one or more States on the basis of 
     Association membership.
       ``(5) Preservation of consumer protection and market 
     conduct regulation.--
       ``(A) In general.--No provision of this section shall be 
     construed as altering or affecting the applicability or 
     continuing effectiveness of any law, regulation, provision, 
     or other action of any State, including those described in 
     subparagraph (B), to the extent that the State law, 
     regulation, provision, or other action is not inconsistent 
     with the provisions of this subtitle related to market entry 
     for nonresident insurance producers, and then only to the 
     extent of the inconsistency.
       ``(B) Preserved regulations.--The laws, regulations, 
     provisions, or other actions of any State referred to in 
     subparagraph (A) include laws, regulations, provisions, or 
     other actions that--
       ``(i) regulate market conduct, insurance producer conduct, 
     or unfair trade practices;
       ``(ii) establish consumer protections; or
       ``(iii) require insurance producers to be appointed by a 
     licensed or authorized insurer.
       ``(f) Biennial Renewal.--Membership in the Association 
     shall be renewed on a biennial basis.
       ``(g) Continuing Education.--
       ``(1) In general.--The Association shall establish, as a 
     condition of membership, continuing education requirements 
     which shall be comparable to the continuing education 
     requirements under the licensing laws of a majority of the 
     States.
       ``(2) State continuing education requirements.--A member 
     may not be required to satisfy continuing education 
     requirements imposed under the laws, regulations, provisions, 
     or actions of any State other than the home State of the 
     member.
       ``(3) Reciprocity.--The Association shall not require a 
     member to satisfy continuing education requirements that are 
     equivalent to any continuing education requirements of the 
     home State of the member that have been satisfied by the 
     member during the applicable licensing period.
       ``(4) Limitation on the association.--The Association shall 
     not directly or indirectly offer any continuing education 
     courses for insurance producers.
       ``(h) Probation, Suspension and Revocation.--
       ``(1) Disciplinary action.--The Association may place an 
     insurance producer that is a member of the Association on 
     probation or suspend or revoke the membership of the 
     insurance producer in the Association, or assess monetary 
     fines or penalties, as the Association determines to be 
     appropriate, if--
       ``(A) the insurance producer fails to meet the applicable 
     membership criteria or other standards established by the 
     Association;
       ``(B) the insurance producer has been subject to 
     disciplinary action pursuant to a final adjudicatory 
     proceeding under the jurisdiction of a State insurance 
     regulator;
       ``(C) an insurance license held by the insurance producer 
     has been suspended or revoked by a State insurance regulator; 
     or
       ``(D) the insurance producer has been convicted of a crime 
     that would have resulted in the denial of membership pursuant 
     to subsection (a)(4)(L)(i) at the time of application, and 
     the Association has received a copy of the final disposition 
     from a court of competent jurisdiction.
       ``(2) Violations of association standards.--The Association 
     shall have the power to investigate alleged violations of 
     Association standards.
       ``(3) Reporting.--The Association shall immediately notify 
     the States (including State insurance regulators) and the 
     NAIC when the membership of an insurance producer has been 
     placed on probation or has been suspended, revoked, or 
     otherwise terminated, or when the Association has assessed 
     monetary fines or penalties.
       ``(i) Consumer Complaints.--
       ``(1) In general.--The Association shall--
       ``(A) refer any complaint against a member of the 
     Association from a consumer relating to alleged misconduct or 
     violations of State insurance laws to the State insurance 
     regulator where the consumer resides and, when appropriate, 
     to any additional State insurance regulator, as determined by 
     standards adopted by the Association; and
       ``(B) make any related records and information available to 
     each State insurance regulator to whom the complaint is 
     forwarded.
       ``(2) Telephone and other access.--The Association shall 
     maintain a toll-free number for purposes of this subsection 
     and, as practicable, other alternative means of communication 
     with consumers, such as an Internet webpage.
       ``(3) Final disposition of investigation.--State insurance 
     regulators shall provide the Association with information 
     regarding the final disposition of a complaint referred 
     pursuant to paragraph (1)(A), but nothing shall be construed 
     to compel a State to release confidential investigation 
     reports or other information protected by State law to the 
     Association.
       ``(j) Information Sharing.--The Association may--
       ``(1) share documents, materials, or other information, 
     including confidential and privileged documents, with a 
     State, Federal, or international governmental entity or with 
     the NAIC or other appropriate entity referred to paragraphs 
     (3) and (4), provided that the recipient has the authority 
     and agrees to maintain the confidentiality or privileged 
     status of the document, material, or other information;
       ``(2) limit the sharing of information as required under 
     this subtitle with the NAIC or any other non-governmental 
     entity, in circumstances under which the Association 
     determines that the sharing of such information is 
     unnecessary to further the purposes of this subtitle;
       ``(3) establish a central clearinghouse, or utilize the 
     NAIC or another appropriate entity, as determined by the 
     Association, as a central clearinghouse, for use by the 
     Association and the States (including State insurance 
     regulators), through which members of the Association may 
     disclose their intent to operate in 1 or more States and pay 
     the licensing fees to the appropriate States; and
       ``(4) establish a database, or utilize the NAIC or another 
     appropriate entity, as determined by the Association, as a 
     database, for use by the Association and the States 
     (including State insurance regulators) for the

[[Page 255]]

     collection of regulatory information concerning the 
     activities of insurance producers.
       ``(k) Effective Date.--The provisions of this section shall 
     take effect on the later of--
       ``(1) the expiration of the 2-year period beginning on the 
     date of enactment of the National Association of Registered 
     Agents and Brokers Reform Act of 2015; and
       ``(2) the date of incorporation of the Association.

     ``SEC. 324. BOARD OF DIRECTORS.

       ``(a) Establishment.--There is established a board of 
     directors of the Association, which shall have authority to 
     govern and supervise all activities of the Association.
       ``(b) Powers.--The Board shall have such of the powers and 
     authority of the Association as may be specified in the 
     bylaws of the Association.
       ``(c) Composition.--
       ``(1) In general.--The Board shall consist of 13 members 
     who shall be appointed by the President, by and with the 
     advice and consent of the Senate, in accordance with the 
     procedures established under Senate Resolution 116 of the 
     112th Congress, of whom--
       ``(A) 8 shall be State insurance commissioners appointed in 
     the manner provided in paragraph (2), 1 of whom shall be 
     designated by the President to serve as the chairperson of 
     the Board until the Board elects one such State insurance 
     commissioner Board member to serve as the chairperson of the 
     Board;
       ``(B) 3 shall have demonstrated expertise and experience 
     with property and casualty insurance producer licensing; and
       ``(C) 2 shall have demonstrated expertise and experience 
     with life or health insurance producer licensing.
       ``(2) State insurance regulator representatives.--
       ``(A) Recommendations.--Before making any appointments 
     pursuant to paragraph (1)(A), the President shall request a 
     list of recommended candidates from the States through the 
     NAIC, which shall not be binding on the President. If the 
     NAIC fails to submit a list of recommendations not later than 
     15 business days after the date of the request, the President 
     may make the requisite appointments without considering the 
     views of the NAIC.
       ``(B) Political affiliation.--Not more than 4 Board members 
     appointed under paragraph (1)(A) shall belong to the same 
     political party.
       ``(C) Former state insurance commissioners.--
       ``(i) In general.--If, after offering each currently 
     serving State insurance commissioner an appointment to the 
     Board, fewer than 8 State insurance commissioners have 
     accepted appointment to the Board, the President may appoint 
     the remaining State insurance commissioner Board members, as 
     required under paragraph (1)(A), of the appropriate political 
     party as required under subparagraph (B), from among 
     individuals who are former State insurance commissioners.
       ``(ii) Limitation.--A former State insurance commissioner 
     appointed as described in clause (i) may not be employed by 
     or have any present direct or indirect financial interest in 
     any insurer, insurance producer, or other entity in the 
     insurance industry, other than direct or indirect ownership 
     of, or beneficial interest in, an insurance policy or annuity 
     contract written or sold by an insurer.
       ``(D) Service through term.--If a Board member appointed 
     under paragraph (1)(A) ceases to be a State insurance 
     commissioner during the term of the Board member, the Board 
     member shall cease to be a Board member.
       ``(3) Private sector representatives.--In making any 
     appointment pursuant to subparagraph (B) or (C) of paragraph 
     (1), the President may seek recommendations for candidates 
     from groups representing the category of individuals 
     described, which shall not be binding on the President.
       ``(4) State insurance commissioner defined.--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 primary insurance regulatory authority for the State.
       ``(d) Terms.--
       ``(1) In general.--Except as provided under paragraph (2), 
     the term of service for each Board member shall be 2 years.
       ``(2) Exceptions.--
       ``(A) 1-year terms.--The term of service shall be 1 year, 
     as designated by the President at the time of the nomination 
     of the subject Board members for--
       ``(i) 4 of the State insurance commissioner Board members 
     initially appointed under paragraph (1)(A), of whom not more 
     than 2 shall belong to the same political party;
       ``(ii) 1 of the Board members initially appointed under 
     paragraph (1)(B); and
       ``(iii) 1 of the Board members initially appointed under 
     paragraph (1)(C).
       ``(B) Expiration of term.--A Board member may continue to 
     serve after the expiration of the term to which the Board 
     member was appointed for the earlier of 2 years or until a 
     successor is appointed.
       ``(C) Mid-term appointments.--A Board member appointed to 
     fill a vacancy occurring before the expiration of the term 
     for which the predecessor of the Board member was appointed 
     shall be appointed only for the remainder of that term.
       ``(3) Successive terms.--Board members may be reappointed 
     to successive terms.
       ``(e) Initial Appointments.--The appointment of initial 
     Board members shall be made no later than 90 days after the 
     date of enactment of the National Association of Registered 
     Agents and Brokers Reform Act of 2015.
       ``(f) Meetings.--
       ``(1) In general.--The Board shall meet--
       ``(A) at the call of the chairperson;
       ``(B) as requested in writing to the chairperson by not 
     fewer than 5 Board members; or
       ``(C) as otherwise provided by the bylaws of the 
     Association.
       ``(2) Quorum required.--A majority of all Board members 
     shall constitute a quorum.
       ``(3) Voting.--Decisions of the Board shall require the 
     approval of a majority of all Board members present at a 
     meeting, a quorum being present.
       ``(4) Initial meeting.--The Board shall hold its first 
     meeting not later than 45 days after the date on which all 
     initial Board members have been appointed.
       ``(g) Restriction on Confidential Information.--Board 
     members appointed pursuant to subparagraphs (B) and (C) of 
     subsection (c)(1) shall not have access to confidential 
     information received by the Association in connection with 
     complaints, investigations, or disciplinary proceedings 
     involving insurance producers.
       ``(h) Ethics and Conflicts of Interest.--The Board shall 
     issue and enforce an ethical conduct code to address 
     permissible and prohibited activities of Board members and 
     Association officers, employees, agents, or consultants. The 
     code shall, at a minimum, include provisions that prohibit 
     any Board member or Association officer, employee, agent or 
     consultant from--
       ``(1) engaging in unethical conduct in the course of 
     performing Association duties;
       ``(2) participating in the making or influencing the making 
     of any Association decision, the outcome of which the Board 
     member, officer, employee, agent, or consultant knows or had 
     reason to know would have a reasonably foreseeable material 
     financial effect, distinguishable from its effect on the 
     public generally, on the person or a member of the immediate 
     family of the person;
       ``(3) accepting any gift from any person or entity other 
     than the Association that is given because of the position 
     held by the person in the Association;
       ``(4) making political contributions to any person or 
     entity on behalf of the Association; and
       ``(5) lobbying or paying a person to lobby on behalf of the 
     Association.
       ``(i) Compensation.--
       ``(1) In general.--Except as provided in paragraph (2), no 
     Board member may receive any compensation from the 
     Association or any other person or entity on account of Board 
     membership.
       ``(2) Travel expenses and per diem.--Board members may be 
     reimbursed only by the Association for travel expenses, 
     including per diem in lieu of subsistence, at rates 
     consistent with rates authorized for employees of Federal 
     agencies under subchapter I of chapter 57 of title 5, United 
     States Code, while away from home or regular places of 
     business in performance of services for the Association.

     ``SEC. 325. BYLAWS, STANDARDS, AND DISCIPLINARY ACTIONS.

       ``(a) Adoption and Amendment of Bylaws and Standards.--
       ``(1) Procedures.--The Association shall adopt procedures 
     for the adoption of bylaws and standards that are similar to 
     procedures under subchapter II of chapter 5 of title 5, 
     United States Code (commonly known as the `Administrative 
     Procedure Act').
       ``(2) Copy required to be filed.--The Board shall submit to 
     the President, through the Department of the Treasury, and 
     the States (including State insurance regulators), and shall 
     publish on the website of the Association, all proposed 
     bylaws and standards of the Association, or any proposed 
     amendment to the bylaws or standards of the Association, 
     accompanied by a concise general statement of the basis and 
     purpose of such proposal.
       ``(3) Effective date.--Any proposed bylaw or standard of 
     the Association, and any proposed amendment to the bylaws or 
     standards of the Association, shall take effect, after notice 
     under paragraph (2) and opportunity for public comment, on 
     such date as the Association may designate, unless suspended 
     under section 329(c).
       ``(4) Rule of construction.--Nothing in this section shall 
     be construed to subject the Board or the Association to the 
     requirements of subchapter II of chapter 5 of title 5, United 
     States Code (commonly known as the `Administrative Procedure 
     Act').
       ``(b) Disciplinary Action by the Association.--
       ``(1) Specification of charges.--In any proceeding to 
     determine whether membership shall be denied, suspended, 
     revoked, or not renewed, or to determine whether a member of 
     the Association should be placed on probation (referred to in 
     this section as a `disciplinary action') or whether to assess 
     fines or monetary penalties, the Association

[[Page 256]]

     shall bring specific charges, notify the member of the 
     charges, give the member an opportunity to defend against the 
     charges, and keep a record.
       ``(2) Supporting statement.--A determination to take 
     disciplinary action shall be supported by a statement setting 
     forth--
       ``(A) any act or practice in which the member has been 
     found to have been engaged;
       ``(B) the specific provision of this subtitle or standard 
     of the Association that any such act or practice is deemed to 
     violate; and
       ``(C) the sanction imposed and the reason for the sanction.
       ``(3) Ineligibility of private sector representatives.--
     Board members appointed pursuant to section 324(c)(3) may 
     not--
       ``(A) participate in any disciplinary action or be counted 
     toward establishing a quorum during a disciplinary action; 
     and
       ``(B) have access to confidential information concerning 
     any disciplinary action.

     ``SEC. 326. POWERS.

       ``In addition to all the powers conferred upon a nonprofit 
     corporation by the District of Columbia Nonprofit Corporation 
     Act, the Association shall have the power to--
       ``(1) establish and collect such membership fees as the 
     Association finds necessary to impose to cover the costs of 
     its operations;
       ``(2) adopt, amend, and repeal bylaws, procedures, or 
     standards governing the conduct of Association business and 
     performance of its duties;
       ``(3) establish procedures for providing notice and 
     opportunity for comment pursuant to section 325(a);
       ``(4) enter into and perform such agreements as necessary 
     to carry out the duties of the Association;
       ``(5) hire employees, professionals, or specialists, and 
     elect or appoint officers, and to fix their compensation, 
     define their duties and give them appropriate authority to 
     carry out the purposes of this subtitle, and determine their 
     qualification;
       ``(6) establish personnel policies of the Association and 
     programs relating to, among other things, conflicts of 
     interest, rates of compensation, where applicable, and 
     qualifications of personnel;
       ``(7) borrow money; and
       ``(8) secure funding for such amounts as the Association 
     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. 327. REPORT BY THE ASSOCIATION.

       ``(a) In General.--As soon as practicable after the close 
     of each fiscal year, the Association shall submit to the 
     President, through the Department of the Treasury, and the 
     States (including State insurance regulators), and shall 
     publish on the website of the Association, a written report 
     regarding the conduct of its business, and the exercise of 
     the other rights and powers granted by this subtitle, during 
     such fiscal year.
       ``(b) Financial Statements.--Each report submitted under 
     subsection (a) with respect to any fiscal year shall include 
     audited financial statements setting forth the financial 
     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. 328. LIABILITY OF THE ASSOCIATION AND THE BOARD 
                   MEMBERS, 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 regulating or taxing 
     insurers, insurance producers, or other entities engaged in 
     the business of insurance, including provisions imposing 
     premium taxes, regulating insurer solvency or financial 
     condition, establishing guaranty funds and levying 
     assessments, or requiring claims settlement practices.
       ``(b) Liability of Board Members, Officers, and 
     Employees.--No Board member, officer, or employee of the 
     Association shall be personally liable to any person for any 
     action taken or omitted in good faith in any matter within 
     the scope of their responsibilities in connection with the 
     Association.

     ``SEC. 329. PRESIDENTIAL OVERSIGHT.

       ``(a) Removal of Board.--If the President determines that 
     the Association is acting in a manner contrary to the 
     interests of the public or 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 Board members were 
     appointed and appoint, in accordance with section 324 and 
     with the advice and consent of the Senate, in accordance with 
     the procedures established under Senate Resolution 116 of the 
     112th Congress, new Board members to fill the vacancies on 
     the Board for the remainder of the terms.
       ``(b) Removal of Board Member.--The President may remove a 
     Board member only for neglect of duty or malfeasance in 
     office.
       ``(c) Suspension of Bylaws and Standards and Prohibition of 
     Actions.--Following notice to the Board, the President, or a 
     person designated by the President for such purpose, may 
     suspend the effectiveness of any bylaw or standard, or 
     prohibit any action, of the Association that the President or 
     the designee determines is contrary to the purposes of this 
     subtitle.

     ``SEC. 330. RELATIONSHIP TO STATE LAW.

       ``(a) Preemption of State Laws.--State laws, regulations, 
     provisions, or other actions purporting to regulate insurance 
     producers shall be preempted to the extent provided in 
     subsection (b).
       ``(b) Prohibited Actions.--
       ``(1) In general.--No State shall--
       ``(A) impede the activities of, take any action against, or 
     apply any provision of law or regulation arbitrarily or 
     discriminatorily 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 member of the 
     Association that it pay fees different from those required to 
     be paid to that State were it not a member of the 
     Association; or
       ``(C) impose any continuing education requirements on any 
     nonresident insurance producer that is a member of the 
     Association.
       ``(2) States other than a home state.--No State, other than 
     the home State of a member of the Association, shall--
       ``(A) impose any licensing, personal or corporate 
     qualifications, education, training, experience, residency, 
     continuing education, or bonding requirement upon a member of 
     the Association that is different from the criteria for 
     membership in the Association or renewal of such membership;
       ``(B) impose any requirement upon a member of the 
     Association that it be licensed, registered, or otherwise 
     qualified to do business or remain in good standing in the 
     State, including any requirement that the insurance producer 
     register as a foreign company with the secretary of state or 
     equivalent State official;
       ``(C) require that a member of the Association submit to a 
     criminal history record check as a condition of doing 
     business in the State; or
       ``(D) impose any licensing, registration, or appointment 
     requirements upon a member of the Association, or require a 
     member of the Association to be authorized to operate as an 
     insurance producer, in order to sell, solicit, or negotiate 
     insurance for commercial property and casualty risks to an 
     insured with risks located in more than one State, if the 
     member is licensed or otherwise authorized to operate in the 
     State where the insured maintains its principal place of 
     business and the contract of insurance insures risks located 
     in that State.
       ``(3) Preservation of state disciplinary authority.--
     Nothing in this section may be construed to prohibit a State 
     from investigating and taking appropriate disciplinary 
     action, including suspension or revocation of authority of an 
     insurance producer to do business in a State, in accordance 
     with State law and that is not inconsistent with the 
     provisions of this section, against a member of the 
     Association as a result of a complaint or for any alleged 
     activity, regardless of whether the activity occurred before 
     or after the insurance producer commenced doing business in 
     the State pursuant to Association membership.

     ``SEC. 331. COORDINATION WITH FINANCIAL INDUSTRY REGULATORY 
                   AUTHORITY.

       ``The Association shall coordinate with the Financial 
     Industry Regulatory Authority in order to ease any 
     administrative burdens that fall on members of the 
     Association that are subject to regulation by the Financial 
     Industry Regulatory Authority, consistent with the 
     requirements of this subtitle and the Federal securities 
     laws.

     ``SEC. 332. RIGHT OF ACTION.

       ``(a) Right of Action.--Any person aggrieved by a decision 
     or action of the Association may, after reasonably exhausting 
     available avenues for resolution within the Association, 
     commence a civil action in an appropriate United States 
     district court, and obtain all appropriate relief.
       ``(b) Association Interpretations.--In any action under 
     subsection (a), the court shall give appropriate weight to 
     the interpretation of the Association of its bylaws and 
     standards and this subtitle.

     ``SEC. 333. FEDERAL FUNDING PROHIBITED.

       ``The Association may not receive, accept, or borrow any 
     amounts from the Federal Government to pay for, or reimburse, 
     the Association for, the costs of establishing or operating 
     the Association.

     ``SEC. 334. DEFINITIONS.

       ``For purposes of this subtitle, the following definitions 
     shall apply:
       ``(1) Business entity.--The term `business entity' means a 
     corporation, association, partnership, limited liability 
     company, limited liability partnership, or other legal 
     entity.
       ``(2) Depository institution.--The term `depository 
     institution' has the meaning as in section 3 of the Federal 
     Deposit Insurance Act (12 U.S.C. 1813).
       ``(3) Home state.--The term `home State' means the State in 
     which the insurance producer maintains its principal place of 
     residence or business and is licensed to act as an insurance 
     producer.
       ``(4) Insurance.--The term `insurance' means any product, 
     other than title insurance or bail bonds, defined or 
     regulated as insurance by the appropriate State insurance 
     regulatory authority.
       ``(5) Insurance producer.--The term `insurance producer' 
     means any insurance

[[Page 257]]

     agent or broker, excess or surplus lines broker or agent, 
     insurance consultant, limited insurance representative, and 
     any other individual or entity that sells, solicits, or 
     negotiates policies of insurance or offers advice, counsel, 
     opinions or services related to insurance.
       ``(6) Insurer.--The term `insurer' has the meaning as in 
     section 313(e)(2)(B) of title 31, United States Code.
       ``(7) Principal place of business.--The term `principal 
     place of business' means the State in which an insurance 
     producer maintains the headquarters of the insurance producer 
     and, in the case of a business entity, where high-level 
     officers of the entity direct, control, and coordinate the 
     business activities of the business entity.
       ``(8) Principal place of residence.--The term `principal 
     place of residence' means the State in which an insurance 
     producer resides for the greatest number of days during a 
     calendar year.
       ``(9) State.--The term `State' includes any State, the 
     District of Columbia, any territory of the United States, and 
     Puerto Rico, Guam, American Samoa, the Trust Territory of the 
     Pacific Islands, the Virgin Islands, and the Northern Mariana 
     Islands.
       ``(10) State law.--
       ``(A) In general.--The term `State law' includes all laws, 
     decisions, rules, regulations, or other State action having 
     the effect of law, of any State.
       ``(B) Laws applicable in the district of columbia.--A law 
     of the United States applicable only to or within the 
     District of Columbia shall be treated as a State law rather 
     than a law of the United States.''.
       (b) Technical Amendment.--The table of contents for the 
     Gramm-Leach-Bliley Act is amended by striking the items 
     relating to subtitle C of title III and inserting the 
     following new items:

  ``Subtitle C--National Association of Registered Agents and Brokers

``Sec. 321. National Association of Registered Agents and Brokers.
``Sec. 322. Purpose.
``Sec. 323. Membership.
``Sec. 324. Board of directors.
``Sec. 325. Bylaws, standards, and disciplinary actions.
``Sec. 326. Powers.
``Sec. 327. Report by the Association.
``Sec. 328. Liability of the Association and the Board members, 
              officers, and employees of the Association.
``Sec. 329. Presidential oversight.
``Sec. 330. Relationship to State law.
``Sec. 331. Coordination with financial industry regulatory authority.
``Sec. 332. Right of action.
``Sec. 333. Federal funding prohibited.
``Sec. 334. Definitions.''.

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