Contradictory Massachusetts bill would turn back clock
✍ Scribed by Edward J. Stone
- Publisher
- John Wiley and Sons
- Year
- 1997
- Tongue
- English
- Weight
- 385 KB
- Volume
- 13
- Category
- Article
- ISSN
- 8756-6079
No coin nor oath required. For personal study only.
✦ Synopsis
The new bill is a maze of conflicting regulations.
Massachusetts bill threatens to turn back the clock for Bay State bankers who sell insurance.
A The bill was scheduled to be reintroduced at the new session of the Massachusetts legislature, on September 17th. It was supposed to move in the Massachusetts State Senate first, and then go to the House.
A maze of contradictions
Unfortunately, the new bill is a maze of conflicting regulations. Is this another clone of the infamous insurance agents' model bill?
"Yes," confirmed Kathleen Collins, attorney for the Financial Institutions Insurance Association (FIIA), Corte Madera, California, "but it has been worked upon-and not improved. The bill allows an unlicensed employee to refer someone to insurance sales personnel-but only if that customer asks."
"So I could be a bank officer who is also a financial planner," she continued, "and I could know that you have all these different assets with me: you have a certificate of deposit, you have this, you have that. And I could know from your financial statement that you have no insurance. And I would be unable to say, 'Gee, you should see one of our insurance sales people.' You can't refer a customer to a licensed insurance agent, unless that person initiates the inquiry. And that seems to be fairly ridiculous."
Deposit taking and insurance activities also have to be physically distinct. "There is a provision that the commissioner can waive it," Collins explained, "if circumstances warrant. But it is subject tean elaborate procedure, where they might have to go through a notice and a hearing."
So would Massachusetts banks have to maintain physically separate premises for insurance and other banking functions? "It must be in distinctly designated areas," Collins advised, "separate and apart from the physical setting which services insured deposit transactions, or transactions involving application for an extension of credit."