Speaking before the National Legislative Conference of the Alexandria, Va.-based Independent Insurance Agents and Brokers of America, Rep. Baker said that the present regulatory system inhibits competition and that consumers in many jurisdictions have fewer choices and pay higher premiums because of it.

Rep. Baker said that if an insurance company wants to put a new product on the market today, it must receive approval from 55 different jurisdictions that have different regulatory requirements.

No other product sold in America faces a similar set of constraints, he said.

Rep. Baker described some of the confusing and inconsistent state regulatory requirements that his subcommittee has identified during three years of investigation and some 15 hearings.

One state, he noted, requires policy numbers to be placed on the bottom left side of a policy, while most other states require the numbers to be placed on the bottom right. If a company gets it wrong, Rep. Baker said, the policy will not be approved.

One state requires documents to be stapled, he said, while another state bars staples.

One state requires certain policy information to appear on pink paper, Rep. Baker said, while other states demand white paper.

He said that during a recent hearing, even the South Carolina Insurance Commissioner, Ernst Csiszar, who is the current president of the Kansas City, Mo.-based National Association of Insurance Commissioners, was surprised that his state prohibits the use of parentheses.

Rep. Baker said he does not know the reason for all these variations. "I think I'm better off not knowing," he said. But he said something has to be done about it.

Rep. Baker and Financial Services Committee Chairman Mike Oxley, R-Ohio, have presented a roadmap to insurance regulatory reform that calls for using federal tools to mandate uniformity but would leave actual regulation to the states.

Rep. Baker emphasized, on his behalf as well as Rep. Oxley's, that this Congress will not consider creation of a federal regulator who would regulate insurance nationally.

But while he acknowledged that some enforcement mechanism would be needed to assure that states comply with any federal standards, he provided no details on what it might be.

Rep. Baker said, however, that the basic goal is to allow the free enterprise system to function.

The Committee, he said, is committed to improving insurance regulation. The Committee, Rep. Baker said, may not get it right at first, but it will be attentive and listen to the industry's concerns.