WASHINGTON-Supporters of optional federal charter legislation calling for Senate hearings on the bill as soon as possible may be getting their wish.

The legislation, known as S. 2509 or the National Insurance Act of 2006, introduced by Sens. John Sununu, R-N.H., and Tim Johnson, D-S.D., would establish an alternate federal insurance regulatory system based on the one used for the banking industry.

In a letter to Senate Banking committee chairman Richard Shelby, R.-Ala., American Insurance Association president Marc Racicot and Frank Keating, president and chief executive officer of the American Council of Life Insurers called for the committee to take up the Sununu/Johnson bill as soon as possible.

“Insurers–and more importantly, insurance consumers–need a more efficient regulatory system,” the two said in the joint letter. “S. 2509's optional national system of insurance regulation would provide for a uniform, focused insurance regulatory system that eliminates state-by-state inconsistencies in regulatory requirements and removes barriers to product innovation.”

An optional federal system, the two said, would provide consumers with standard protections nationwide, while also giving insurance companies increased ability to develop new products and respond to the changing needs of the market. “In short,” they said, “all stakeholders would benefit from enactment of an optional federal charter.”

Mr. Keating and Mr. Racicot noted that between the two groups, AIA and ACLI members have invested $5.6 trillion in the U.S. economy and that their business stretch across state lines and international borders.

They wrote, “We strongly believe that the Sununu/Johnson bill would bring insurance regulation into the 21st century by extending to insurers the same regulatory option as national and state-chartered banks (a highly successful model). More importantly, it would establish strong and consistent consumer protections. Creating an optional national charter is essential to maintaining a healthy and competitive insurance marketplace across our great nation.”

According to one of the bill's sponsors, the AIA and the ACLI's wish will come true, as the committee will hold discussions on the bill.

At a meeting of the Property and Casualty Insurers Association of America in Washington Thursday, Sen. Sununu said the Banking committee would hold hearings in the near term. The bill, he said, would provide “a good platform for discussion in hearings of the Banking committee that will take place this year.”