Regulators have been aiming to approve at least part of the measure before 2005 so that it can be considered by state legislatures in the new year.

The state regulators adopted Section A of the draft, which proposes that a producer receiving any compensation from the customer for an insurance placement or representing the customer with respect to that placement, shouldn't accept any compensation from an insurer--or other third party--for that placement of insurance unless the producer has, prior to the customer's purchase of insurance:

? Obtained the customer's documented acknowledgment that such compensation will be received by the producer or affiliate.

? Disclosed the amount of compensation from the insurer or other third party for that placement. If the amount of compensation is not known at the time of disclosure, the producer shall disclose the specific method for calculating such compensation and, if possible, a reasonable estimate of the amount.

This requirement, however, will not apply to a producer who meets all of the following requirements:

? Does not receive compensation from the customer for the placement of insurance.

? In connection with that placement of insurance, the producer represents an insurer that has appointed the producer.

? Discloses to the customer prior to the purchase of insurance that the insurance producer will receive compensation from an insurer in connection with that placement; or that, in connection with that placement of insurance, the insurance producer represents the insurer and that the producer may provide services to the customer for the insurer.

The regulators also approved other sections that specify how various terms such as "customer" and "affiliate" should be defined and that certain intermediaries, such as a managing general agent or a reinsurance intermediary, could be excluded from the disclosure requirement.

The regulators decided to defer Section B of the amendment during today's conference call for the next 90 days.

The section expands on what specific compensation information should be disclosed by producers. The regulators said they will look at, among other issues, fiduciary liability issues, disclosure of all quotes, and producer-owned reinsurance arrangements for possible inclusions in the section.