Regulation has the "capacity to tie the economy in knots," says Donohue, who adds that the U.S. Chamber of Commerce sues the U.S. government about 150 times per year.

"I know this is a huge issue in your industry," he says. Donohue urged the insurance industry to provide more leadership on over-regulation issues.

The industry already has a start in that department. Donohue was introduced by Edward B. Rust Jr.—who is chairman of the U.S. Chamber of Commerce in addition to being the CEO of State Farm. 

It would appear the insurance industry agrees that regulation is a top concern. According to a survey conducted by the Insurance Information Institute, 74 percent of executives at the conference think the federal government is looking to expand its oversight of insurers.

ENERGY IN THE THIRD BUCKET

Donohue gave the insurance audience a hint at some possible opportunities when he suggested that energy could be crucial to growing the economy and reducing the deficit.

Growth is typically done with two "buckets," says Donohue—one holding items such as expense cuts and entitlement reductions and the other holding an increase in taxes.

But a third bucket—energy—could be the key to growing jobs and exiting a current path toward trillions in debt accumulated per year and barely making enough money to sustain our institutions.

The U.S. could "move from the buyers to the guys who have more energy than anybody else."

With the oil, coal and technology this country has, it can be done, Donohue says. And if politicians fear the environmentalists, "We can do this with clean energy," he says. "That's where the cash is."