"He is doing exactly what is needed to reform the insurance regulatory system," Mr. Rusbuldt said.

IIABA has long supported the approach outlined by Rep. Oxley during a speech before the National Association of Insurance Commissioners in New York, which is to use federal tools to create a more uniform system, but to keep actual regulation with the states.

In his speech, Rep. Oxley ruled out optional federal chartering or any type of dual insurance regulatory system.

Rather, he said, the Committee would establish a Federal-State Advisory Council to coordinate future discussions over insurance tax policy and uniformity. The goal, Rep. Oxley said, would be to build on the work already done by the Kansas City, Mo.-based NAIC to create a more uniform, efficient and market-based insurance regulatory system.

Ken A. Crerar, president of the Washington-based Council of Insurance Agents and Brokers, which supports optional federal chartering, said the Council "heartily embraces" the road map developed by Rep. Oxley and Rep. Richard Baker, R-La., who chairs the Financial Services subcommittee with jurisdiction over insurance.

"While our association fully supports the concept of an optional federal charter for insurers, we don't believe that the perfect should become the enemy of the good," Mr. Crerar said.

"The proposals offered by Chairman Oxley are better than good," he added. "They would build upon state-based efforts and they provide both carrots and sticks for states to effectively respond."

Beth Climo, executive director of the Washington-based American Bankers Insurance Association, one of the earliest supporters of optional chartering, called the Oxley/Baker plan "a step in the right direction to real reform without precluding the possibility of an OFC in the future."

She said ABIA looks forward to working with the Committee to ensure that the federal/state body will have the necessary authority to require states to comply with national insurance policy.

"Absent such clear authority, the outlined reforms could become a road map to greater complexity and confusion, rather than constructive reform," Ms. Climo said. "Only by granting this power will insurers and consumers be able to see real results from this proposal."

Mr. Rusbuldt said he hopes to see the industry work with Reps. Oxley and Baker to achieve real reform. He noted that Rep. Oxley said he would take a middle-ground approach, and the proposal he has outlined is "exactly right."

Politics, Mr. Rusbuldt said, is the art of the possible. The Oxley/Baker proposal, he said, is one that can pass.