AIA: Info Sharing Bill Still Flawed
NU Online News Service, Aug. 23, 9:58 a.m. EST? An insurer group is predicting their industry will suffer if an effort to overhaul financial services industry operations by California State Sen. Jackie Speier, D-San Francisco, succeeds.
"Nothing has changed in the last year. This bill remains fundamentally flawed and will cause unforeseen consequences," said Bill Gausewitz, American Insurance Association assistant vice president, Western region. "This bill discriminates against companies based on their corporate structure, and its technical problems will disrupt the internal operations of many organizations."
The measure, SB 773, will create an opt-out system for information sharing between affiliated entities and an opt-in system for information sharing between non-affiliated third parties.
"Research by professors at Columbia University estimates the opt-in regime created in this bill will cost businesses and consumers billions of dollars," Mr. Gausewitz said.
He said that SB 773 will separate California "from the national framework and force banks and insurers to retool operations to comply with a special set of California rules."
The bill will threaten California's "already struggling economy, reduce jobs, and cause more confusion among consumers," Mr. Gausewitz concluded.
The Assembly Banking Committee has approved SB 773 by an 8-4 vote. The bill will now be heard by the Assembly Judiciary Committee before heading to a full vote on the Assembly Floor.
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