The California Office of Administrative Law (OAL) declared the state insurance commissioner’s actions against insurers holding investment relations with Iran to be “improper.”
Steve Poizner
The OAL intervened after the American Insurance Association (AIA) and other trade associations filed a petition asking whether actions by Commissioner Steve Poizner against insurers regarding Iran investment activity amounted to underground regulations, which are rules that were not adopted according to formal rulemaking procedures, according to the AIA.
In Dececember 2009, Poizner required each insurer licensed in the state disclose its investments in “state sponsors of terrorism” to learn if any premium dollars were supporting Iran.
More than 1,000 insurance companies, representing more than 75% of those doing business in the state, agreed to forgo future investments in 50 companies identified by Poizner’s office as doing business with Iran’s nuclear, energy and defense sectors. The California Department of Insurance disqualified an estimated $6 billion in holdings in those 50 Iran-related companies. In addition to the list of insurers agreeing to the voluntary moratorium, Poizner also released the names of 296 companies who would not agree to his request.
“AIA is pleased that the Office of Administrative Law found that the insurance commissioner’s activities with respect to insurer investments in companies doing business in Iran were underground regulations,” Steve Suchil, AIA assistant vice president for the western region, said in a statement. “The commissioner failed to adopt such rules under state law as provided in the Administrative Procedure Act. Insurers fully comply with all state and federal laws as pertaining to investments and disclosure. AIA and other trade associations petitioned the Office of Administrative Law to find that the commissioner’s actions were improper underground regulations.”
Poizner’s actions on insurers’ Iranian investments ruled ‘improper’ via IFAwebnews.com .
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