At the group's annual meeting last Saturday in Duck Key, Fla., the Executive Committee of the body formally endorsed its president's initiative.

The move puts NCOIL at odds with the National Association of Insurance Commissioners, which continues to work with the House Financial Services Committee in drafting so-called federal tools legislation.

For the first half of the year the two groups worked hand in hand to impress the federal lawmakers with their seriousness in creating uniform regulation and were successful in jointly developing market conduct model legislation

Sen. Geller said the initial efforts at cooperation were aimed at getting a "place at the so-called mythical table."

"But at some point you have to draw a line in the sand," he said, "because as legislators we all know that if we continue to take part in the process, then in the end we will have to support its outcome."

The initial draft of the SMART legislation that came out late last summer infuriated state lawmakers, who felt that it stripped them of their powers in favor of federal and state regulators, and in particular the NAIC.

"There has been some concern that from the NAIC perspective a lot of its support has been staff driven, because they see a greater role for themselves in the process," Sen. Geller said. "I really don't think the NAIC has been well-served by its staff."

Sen. Geller said NCOIL opposition stemmed from the measure's rate and form deregulation, the presence of a federal regulator, and federalized agent licensing, which he felt would end up in a "race to the bottom" in terms of regulatory standards.

At a forum just prior to the Executive Committee meeting, consumer and industry representatives clashed over the impact of the federal standards legislation.

Robert Hunter, insurance director for the Consumer Federation of America, has often found himself at odds with NCOIL. But on Saturday he struck a chord with the legislators.

"This is great for the NAIC; this is great for the regulators," he said. "But it leaves the state legislators totally out of the mix."

Julie Gackenback, a lobbyist for the Property Casualty Insurance Association of America, downplayed the regulatory role of any federal officer and noted that the models the legislation refers to do not necessarily have to come from the NAIC.

Rhode Island State Sen. Dave Bates, R.-Barrington., expressed only qualms about the group's action, fearing that the alternative of optional federal charter legislation will be much worse than what is currently under discussion.

But meeting participants agreed that House passage of any such implementation measure was at least a year off, and Senate passage even further down the road.