Terrorism Risk Insurance Program Reauthorization Act of 2015

H. R. 26

One Hundred Fourteenth Congress
of the
United States of America
AT T H E F I R S T S E S S I O N
Begun and held at the City of Washington on Tuesday,
the sixth day of January, two thousand and fifteen

An Act
To extend the termination date of the Terrorism Insurance Program established
under the Terrorism Risk Insurance Act of 2002, and for other purposes.

Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,
SECTION 1. SHORT TITLE AND TABLE OF CONTENTS.

(a) SHORT TITLE.—This Act may be cited as the ‘‘Terrorism
Risk Insurance Program Reauthorization Act of 2015’’.
(b) TABLE OF CONTENTS.—The table of contents for this Act
is as follows:
Sec. 1. Short title and table of contents.
TITLE I—EXTENSION OF TERRORISM INSURANCE PROGRAM
Sec.
Sec.
Sec.
Sec.
Sec.

101.
102.
103.
104.
105.

Sec.
Sec.
Sec.
Sec.
Sec.
Sec.
Sec.

106.
107.
108.
109.
110.
111.
112.

Extension of Terrorism Insurance Program.
Federal share.
Program trigger.
Recoupment of Federal share of compensation under the program.
Certification of acts of terrorism; consultation with Secretary of Homeland
Security.
Technical amendments.
Improving the certification process.
GAO study.
Membership of Board of Governors of the Federal Reserve System.
Advisory Committee on Risk-Sharing Mechanisms.
Reporting of terrorism insurance data.
Annual study of small insurer market competitiveness.

TITLE II—NATIONAL ASSOCIATION OF REGISTERED AGENTS AND
BROKERS REFORM
Sec. 201. Short title.
Sec. 202. Reestablishment of the National Association of Registered Agents and
Brokers.
TITLE III—BUSINESS RISK MITIGATION AND PRICE STABILIZATION
Sec. 301. Short title.
Sec. 302. Margin requirements.
Sec. 303. Implementation.

TITLE I—EXTENSION OF TERRORISM
INSURANCE PROGRAM
SEC. 101. EXTENSION OF TERRORISM INSURANCE PROGRAM.

Section 108(a) of the Terrorism Risk Insurance Act of 2002
(15 U.S.C. 6701 note) is amended by striking ‘‘December 31, 2014’’
and inserting ‘‘December 31, 2020’’.

H. R. 26—2
SEC. 102. FEDERAL SHARE.

Section 103(e)(1)(A) of the Terrorism Risk Insurance Act of
2002 (15 U.S.C. 6701 note) is amended by inserting ‘‘and beginning
on January 1, 2016, shall decrease by 1 percentage point per calendar year until equal to 80 percent’’ after ‘‘85 percent’’.
SEC. 103. PROGRAM TRIGGER.

Subparagraph (B) of section 103(e)(1) (15 U.S.C. 6701 note)
is amended in the matter preceding clause (i)—
(1) by striking ‘‘a certified act’’ and inserting ‘‘certified
acts’’;
(2) by striking ‘‘such certified act’’ and inserting ‘‘such
certified acts’’; and
(3) by striking ‘‘exceed’’ and all that follows through clause
(ii) and inserting the following: ‘‘exceed—
‘‘(i) $100,000,000, with respect to such insured
losses occurring in calendar year 2015;
‘‘(ii) $120,000,000, with respect to such insured
losses occurring in calendar year 2016;
‘‘(iii) $140,000,000, with respect to such insured
losses occurring in calendar year 2017;
‘‘(iv) $160,000,000, with respect to such insured
losses occurring in calendar year 2018;
‘‘(v) $180,000,000, with respect to such insured
losses occurring in calendar year 2019; and
‘‘(vi) $200,000,000, with respect to such insured
losses occurring in calendar year 2020 and any calendar year thereafter.’’.
SEC. 104. RECOUPMENT OF FEDERAL SHARE OF COMPENSATION
UNDER THE PROGRAM.

Section 103(e) of the Terrorism Risk Insurance Act of 2002
(15 U.S.C. 6701 note) is amended—
(1) by amending paragraph (6) to read as follows:
‘‘(6) INSURANCE MARKETPLACE AGGREGATE RETENTION
AMOUNT.—
‘‘(A) IN GENERAL.—For purposes of paragraph (7), the
insurance marketplace aggregate retention amount shall
be the lesser of—
‘‘(i) $27,500,000,000, as such amount is revised
pursuant to this paragraph; and
‘‘(ii) the aggregate amount, for all insurers, of
insured losses during such calendar year.
‘‘(B) REVISION OF INSURANCE MARKETPLACE AGGREGATE
RETENTION AMOUNT.—
‘‘(i) PHASE-IN.—Beginning in the calendar year of
enactment of the Terrorism Risk Insurance Program
Reauthorization Act of 2015, the amount set forth
under subparagraph (A)(i) shall increase by
$2,000,000,000 per calendar year until equal to
$37,500,000,000.
‘‘(ii) FURTHER REVISION.—Beginning in the calendar year that follows the calendar year in which
the amount set forth under subparagraph (A)(i) is equal
to $37,500,000,000, the amount under subparagraph
(A)(i) shall be revised to be the amount equal to the
annual average of the sum of insurer deductibles for

H. R. 26—3
all insurers participating in the Program for the prior
3 calendar years, as such sum is determined by the
Secretary under subparagraph (C).
‘‘(C) RULEMAKING.—Not later than 3 years after the
date of enactment of the Terrorism Risk Insurance Program
Reauthorization Act of 2015, the Secretary shall—
‘‘(i) issue final rules for determining the amount
of the sum described under subparagraph (B)(ii); and
‘‘(ii) provide a timeline for public notification of
such determination.’’; and
(2) in paragraph (7)—
(A) in subparagraph (A)—
(i) in the matter preceding clause (i), by striking
‘‘for each of the periods referred to in subparagraphs
(A) through (E) of paragraph (6)’’; and
(ii) in clause (i), by striking ‘‘for such period’’;
(B) by striking subparagraph (B) and inserting the
following:
‘‘(B) [Reserved.]’’;
(C) in subparagraph (C)—
(i) by striking ‘‘occurring during any of the periods
referred to in any of subparagraphs (A) through (E)
of paragraph (6), terrorism loss risk-spreading premiums in an amount equal to 133 percent’’ and
inserting ‘‘, terrorism loss risk-spreading premiums in
an amount equal to 140 percent’’; and
(ii) by inserting ‘‘as calculated under subparagraph
(A)’’ after ‘‘mandatory recoupment amount’’; and
(D) in subparagraph (E)(i)—
(i) in subclause (I)—
(I) by striking ‘‘2010’’ and inserting ‘‘2017’’;
and
(II) by striking ‘‘2012’’ and inserting ‘‘2019’’;
(ii) in subclause (II)—
(I) by striking ‘‘2011’’ and inserting ‘‘2018’’;
(II) by striking ‘‘2012’’ and inserting ‘‘2019’’;
and
(III) by striking ‘‘2017’’ and inserting ‘‘2024’’;
and
(iii) in subclause (III)—
(I) by striking ‘‘2012’’ and inserting ‘‘2019’’;
and
(II) by striking ‘‘2017’’ and inserting ‘‘2024’’.
SEC. 105. CERTIFICATION OF ACTS OF TERRORISM; CONSULTATION
WITH SECRETARY OF HOMELAND SECURITY.

Paragraph (1)(A) of section 102 (15 U.S.C. 6701 note) is
amended in the matter preceding clause (i), by striking ‘‘concurrence
with the Secretary of State’’ and inserting ‘‘consultation with the
Secretary of Homeland Security’’.
SEC. 106. TECHNICAL AMENDMENTS.

The Terrorism Risk Insurance Act of 2002 (15 U.S.C. 6701
note) is amended—
(1) in section 102—
(A) in paragraph (3)—
(i) by redesignating subparagraphs (A), (B), and
(C) as clauses (i), (ii), and (iii), respectively;

H. R. 26—4
(ii) in the matter preceding clause (i) (as so redesignated), by striking ‘‘An entity has’’ and inserting the
following:
‘‘(A) IN GENERAL.—An entity has’’; and
(iii) by adding at the end the following new
subparagraph:
‘‘(B) RULE OF CONSTRUCTION.—An entity, including any
affiliate thereof, does not have ‘control’ over another entity,
if, as of the date of enactment of the Terrorism Risk Insurance Program Reauthorization Act of 2015, the entity is
acting as an attorney-in-fact, as defined by the Secretary,
for the other entity and such other entity is a reciprocal
insurer, provided that the entity is not, for reasons other
than the attorney-in-fact relationship, defined as having
‘control’ under subparagraph (A).’’;
(B) in paragraph (7)—
(i) by striking subparagraphs (A) through (F) and
inserting the following:
‘‘(A) the value of an insurer’s direct earned premiums
during the immediately preceding calendar year, multiplied
by 20 percent; and’’;
(ii) by redesignating subparagraph (G) as subparagraph (B); and
(iii) in subparagraph (B), as so redesignated by
clause (ii)—
(I) by striking ‘‘notwithstanding subparagraphs (A) through (F), for the Transition Period
or any Program Year’’ and inserting ‘‘notwithstanding subparagraph (A), for any calendar year’’;
and
(II) by striking ‘‘Period or Program Year’’ and
inserting ‘‘calendar year’’;
(C) by striking paragraph (11); and
(D) by redesignating paragraphs (12) through (16) as
paragraphs (11) through (15), respectively; and
(2) in section 103—
(A) in subsection (b)(2)—
(i) in subparagraph (B), by striking ‘‘, purchase,’’;
and
(ii) in subparagraph (C), by striking ‘‘, purchase,’’;
(B) in subsection (c), by striking ‘‘Program Year’’ and
inserting ‘‘calendar year’’;
(C) in subsection (e)—
(i) in paragraph (1)(A), as previously amended by
section 102—
(I) by striking ‘‘the Transition Period and each
Program Year through Program Year 4 shall be
equal to 90 percent, and during Program Year
5 and each Program Year thereafter’’ and inserting
‘‘each calendar year’’;
(II) by striking the comma after ‘‘80 percent’’;
and
(III) by striking ‘‘such Transition Period or
such Program Year’’ and inserting ‘‘such calendar
year’’;
(ii) in paragraph (2)(A), by striking ‘‘the period
beginning on the first day of the Transition Period

H. R. 26—5
and ending on the last day of Program Year 1, or
during any Program Year thereafter’’ and inserting
‘‘a calendar year’’; and
(iii) in paragraph (3), by striking ‘‘the period beginning on the first day of the Transition Period and
ending on the last day of Program Year 1, or during
any other Program Year’’ and inserting ‘‘any calendar
year’’; and
(D) in subsection (g)(2)—
(i) by striking ‘‘the Transition Period or a Program
Year’’ each place that term appears and inserting ‘‘the
calendar year’’;
(ii) by striking ‘‘such period’’ and inserting ‘‘the
calendar year’’; and
(iii) by striking ‘‘that period’’ and inserting ‘‘the
calendar year’’.
SEC. 107. IMPROVING THE CERTIFICATION PROCESS.

(a) DEFINITIONS.—As used in this section—
(1) the term ‘‘act of terrorism’’ has the same meaning
as in section 102(1) of the Terrorism Risk Insurance Act of
2002 (15 U.S.C. 6701 note);
(2) the term ‘‘certification process’’ means the process by
which the Secretary determines whether to certify an act as
an act of terrorism under section 102(1) of the Terrorism Risk
Insurance Act of 2002 (15 U.S.C. 6701 note); and
(3) the term ‘‘Secretary’’ means the Secretary of the
Treasury.
(b) STUDY.—Not later than 9 months after the date of enactment
of this Act, the Secretary shall conduct and complete a study on
the certification process.
(c) REQUIRED CONTENT.—The study required under subsection
(a) shall include an examination and analysis of—
(1) the establishment of a reasonable timeline by which
the Secretary must make an accurate determination on whether
to certify an act as an act of terrorism;
(2) the impact that the length of any timeline proposed
to be established under paragraph (1) may have on the insurance industry, policyholders, consumers, and taxpayers as a
whole;
(3) the factors the Secretary would evaluate and monitor
during the certification process, including the ability of the
Secretary to obtain the required information regarding the
amount of projected and incurred losses resulting from an act
which the Secretary would need in determining whether to
certify the act as an act of terrorism;
(4) the appropriateness, efficiency, and effectiveness of the
consultation process required under section 102(1)(A) of the
Terrorism Risk Insurance Act of 2002 (15 U.S.C. 6701 note)
and any recommendations on changes to the consultation
process; and
(5) the ability of the Secretary to provide guidance and
updates to the public regarding any act that may reasonably
be certified as an act of terrorism.
(d) REPORT.—Upon completion of the study required under
subsection (a), the Secretary shall submit a report on the results
of such study to the Committee on Banking, Housing, and Urban

H. R. 26—6
Affairs of the Senate and the Committee on Financial Services
of the House of Representatives.
(e) RULEMAKING.—Section 102(1) of the Terrorism Risk Insurance Act of 2002 (15 U.S.C. 6701 note) is amended—
(1) by redesignating subparagraph (D) as subparagraph
(E); and
(2) by inserting after subparagraph (C) the following:
‘‘(D) TIMING OF CERTIFICATION.—Not later than 9
months after the report required under section 107 of the
Terrorism Risk Insurance Program Reauthorization Act of
2015 is submitted to the appropriate committees of Congress, the Secretary shall issue final rules governing the
certification process, including establishing a timeline for
which an act is eligible for certification by the Secretary
on whether an act is an act of terrorism under this paragraph.’’.
SEC. 108. GAO STUDY.

(a) STUDY.—Not later than 2 years after the date of enactment
of this Act, the Comptroller General of the United States shall
complete a study on the viability and effects of the Federal Government—
(1) assessing and collecting upfront premiums on insurers
that participate in the Terrorism Insurance Program established under the Terrorism Risk Insurance Act of 2002 (15
U.S.C. 6701 note) (hereafter in this section referred to as the
‘‘Program’’), which shall include a comparison of practices in
international markets to assess and collect premiums either
before or after terrorism losses are incurred; and
(2) creating a capital reserve fund under the Program and
requiring insurers participating in the Program to dedicate
capital specifically for terrorism losses before such losses are
incurred, which shall include a comparison of practices in international markets to establish reserve funds.
(b) REQUIRED CONTENT.—The study required under subsection
(a) shall examine, but shall not be limited to, the following issues:
(1) UPFRONT PREMIUMS.—With respect to upfront premiums
described in subsection (a)(1)—
(A) how the Federal Government could determine the
price of such upfront premiums on insurers that participate
in the Program;
(B) how the Federal Government could collect and
manage such upfront premiums;
(C) how the Federal Government could ensure that
such upfront premiums are not spent for purposes other
than claims through the Program;
(D) how the assessment and collection of such upfront
premiums could affect take-up rates for terrorism risk coverage in different regions and industries and how it could
impact small businesses and consumers in both metropolitan and non-metropolitan areas;
(E) the effect of collecting such upfront premiums on
insurers both large and small;
(F) the effect of collecting such upfront premiums on
the private market for terrorism risk reinsurance; and
(G) the size of any Federal Government subsidy
insurers may receive through their participation in the

H. R. 26—7
Program, taking into account the Program’s current postevent recoupment structure.
(2) CAPITAL RESERVE FUND.—With respect to the capital
reserve fund described in subsection (a)(2)—
(A) how the creation of a capital reserve fund would
affect the Federal Government’s fiscal exposure under the
Terrorism Risk Insurance Program and the ability of the
Program to meet its statutory purposes;
(B) how a capital reserve fund would impact insurers
and reinsurers, including liquidity, insurance pricing, and
capacity to provide terrorism risk coverage;
(C) the feasibility of segregating funds attributable
to terrorism risk from funds attributable to other insurance
lines;
(D) how a capital reserve fund would be viewed and
treated under current Financial Accounting Standards
Board accounting rules and the tax laws; and
(E) how a capital reserve fund would affect the States’
ability to regulate insurers participating in the Program.
(3) INTERNATIONAL PRACTICES.—With respect to international markets referred to in paragraphs (1) and (2) of subsection (a), how other countries, if any—
(A) have established terrorism insurance structures;
(B) charge premiums or otherwise collect funds to pay
for the costs of terrorism insurance structures, including
risk and administrative costs; and
(C) have established capital reserve funds to pay for
the costs of terrorism insurance structures.
(c) REPORT.—Upon completion of the study required under subsection (a), the Comptroller General shall submit a report on the
results of such study to the Committee on Banking, Housing, and
Urban Affairs of the Senate and the Committee on Financial Services of the House of Representatives.
(d) PUBLIC AVAILABILITY.—The study and report required under
this section shall be made available to the public in electronic
form and shall be published on the website of the Government
Accountability Office.
SEC. 109. MEMBERSHIP OF BOARD OF GOVERNORS OF THE FEDERAL
RESERVE SYSTEM.

(a) IN GENERAL.—The first undesignated paragraph of section
10 of the Federal Reserve Act (12 U.S.C. 241) is amended by
inserting after the second sentence the following: ‘‘In selecting members of the Board, the President shall appoint at least 1 member
with demonstrated primary experience working in or supervising
community banks having less than $10,000,000,000 in total assets.’’.
(b) EFFECTIVE DATE.—The amendment made by this section
shall take effect on the date of enactment of this Act and apply
to appointments made on and after that effective date, excluding
any nomination pending in the Senate on that date.
SEC. 110. ADVISORY COMMITTEE ON RISK-SHARING MECHANISMS.

(a) FINDING; RULE OF CONSTRUCTION.—
(1) FINDING.—Congress finds that it is desirable to encourage the growth of nongovernmental, private market reinsurance
capacity for protection against losses arising from acts of terrorism.

H. R. 26—8
(2) RULE OF CONSTRUCTION.—Nothing in this Act, any
amendment made by this Act, or the Terrorism Risk Insurance
Act of 2002 (15 U.S.C. 6701 note) shall prohibit insurers from
developing risk-sharing mechanisms to voluntarily reinsure terrorism losses between and among themselves.
(b) ADVISORY COMMITTEE ON RISK-SHARING MECHANISMS.—
(1) ESTABLISHMENT.—The Secretary of the Treasury shall
establish and appoint an advisory committee to be known as
the ‘‘Advisory Committee on Risk-Sharing Mechanisms’’
(referred to in this subsection as the ‘‘Advisory Committee’’).
(2) DUTIES.—The Advisory Committee shall provide advice,
recommendations, and encouragement with respect to the creation and development of the nongovernmental risk-sharing
mechanisms described under subsection (a).
(3) MEMBERSHIP.—The Advisory Committee shall be composed of 9 members who are directors, officers, or other
employees of insurers, reinsurers, or capital market participants that are participating or that desire to participate in
the nongovernmental risk-sharing mechanisms described under
subsection (a), and who are representative of the affected sectors of the insurance industry, including commercial property
insurance, commercial casualty insurance, reinsurance, and
alternative risk transfer industries.
SEC. 111. REPORTING OF TERRORISM INSURANCE DATA.

Section 104 (15 U.S.C. 6701 note) is amended by adding at
the end the following new subsection:
‘‘(h) REPORTING OF TERRORISM INSURANCE DATA.—
‘‘(1) AUTHORITY.—During the calendar year beginning on
January 1, 2016, and in each calendar year thereafter, the
Secretary shall require insurers participating in the Program
to submit to the Secretary such information regarding insurance
coverage for terrorism losses of such insurers as the Secretary
considers appropriate to analyze the effectiveness of the Program, which shall include information regarding—
‘‘(A) lines of insurance with exposure to such losses;
‘‘(B) premiums earned on such coverage;
‘‘(C) geographical location of exposures;
‘‘(D) pricing of such coverage;
‘‘(E) the take-up rate for such coverage;
‘‘(F) the amount of private reinsurance for acts of terrorism purchased; and
‘‘(G) such other matters as the Secretary considers
appropriate.
‘‘(2) REPORTS.—Not later than June 30, 2016, and every
other June 30 thereafter, the Secretary shall submit a report
to the Committee on Financial Services of the House of Representatives and the Committee on Banking, Housing, and
Urban Affairs of the Senate that includes—
‘‘(A) an analysis of the overall effectiveness of the Program;
‘‘(B) an evaluation of any changes or trends in the
data collected under paragraph (1);
‘‘(C) an evaluation of whether any aspects of the Program have the effect of discouraging or impeding insurers
from providing commercial property casualty insurance coverage or coverage for acts of terrorism;

H. R. 26—9
‘‘(D) an evaluation of the impact of the Program on
workers’ compensation insurers; and
‘‘(E) in the case of the data reported in paragraph
(1)(B), an updated estimate of the total amount earned
since January 1, 2003.
‘‘(3) PROTECTION OF DATA.—To the extent possible, the Secretary shall contract with an insurance statistical aggregator
to collect the information described in paragraph (1), which
shall keep any nonpublic information confidential and provide
it to the Secretary in an aggregate form or in such other
form or manner that does not permit identification of the
insurer submitting such information.
‘‘(4) ADVANCE COORDINATION.—Before collecting any data
or information under paragraph (1) from an insurer, or affiliate
of an insurer, the Secretary shall coordinate with the appropriate State insurance regulatory authorities and any relevant
government agency or publicly available sources to determine
if the information to be collected is available from, and may
be obtained in a timely manner by, individually or collectively,
such entities. If the Secretary determines that such data or
information is available, and may be obtained in a timely
matter, from such entities, the Secretary shall obtain the data
or information from such entities. If the Secretary determines
that such data or information is not so available, the Secretary
may collect such data or information from an insurer and
affiliates.
‘‘(5) CONFIDENTIALITY.—
‘‘(A) RETENTION OF PRIVILEGE.—The submission of any
non-publicly available data and information to the Secretary and the sharing of any non-publicly available data
with or by the Secretary among other Federal agencies,
the State insurance regulatory authorities, or any other
entities under this subsection shall not constitute a waiver
of, or otherwise affect, any privilege arising under Federal
or State law (including the rules of any Federal or State
court) to which the data or information is otherwise subject.
‘‘(B) CONTINUED APPLICATION OF PRIOR CONFIDENTIALITY AGREEMENTS.—Any requirement under Federal or
State law to the extent otherwise applicable, or any requirement pursuant to a written agreement in effect between
the original source of any non-publicly available data or
information and the source of such data or information
to the Secretary, regarding the privacy or confidentiality
of any data or information in the possession of the source
to the Secretary, shall continue to apply to such data
or information after the data or information has been provided pursuant to this subsection.
‘‘(C) INFORMATION-SHARING AGREEMENT.—Any data or
information obtained by the Secretary under this subsection
may be made available to State insurance regulatory
authorities, individually or collectively through an information-sharing agreement that—
‘‘(i) shall comply with applicable Federal law; and
‘‘(ii) shall not constitute a waiver of, or otherwise
affect, any privilege under Federal or State law
(including any privilege referred to in subparagraph

H. R. 26—10
(A) and the rules of any Federal or State court) to
which the data or information is otherwise subject.
‘‘(D) AGENCY DISCLOSURE REQUIREMENTS.—Section 552
of title 5, United States Code, including any exceptions
thereunder, shall apply to any data or information submitted under this subsection to the Secretary by an insurer
or affiliate of an insurer.’’.
SEC. 112. ANNUAL STUDY OF SMALL INSURER MARKET COMPETITIVENESS.

Section 108 (15 U.S.C. 6701 note) is amended by adding at
the end the following new subsection:
‘‘(h) STUDY OF SMALL INSURER MARKET COMPETITIVENESS.—
‘‘(1) IN GENERAL.—Not later than June 30, 2017, and every
other June 30 thereafter, the Secretary shall conduct a study
of small insurers (as such term is defined by regulation by
the Secretary) participating in the Program, and identify any
competitive challenges small insurers face in the terrorism
risk insurance marketplace, including—
‘‘(A) changes to the market share, premium volume,
and policyholder surplus of small insurers relative to large
insurers;
‘‘(B) how the property and casualty insurance market
for terrorism risk differs between small and large insurers,
and whether such a difference exists within other perils;
‘‘(C) the impact of the Program’s mandatory availability
requirement under section 103(c) on small insurers;
‘‘(D) the effect of increasing the trigger amount for
the Program under section 103(e)(1)(B) on small insurers;
‘‘(E) the availability and cost of private reinsurance
for small insurers; and
‘‘(F) the impact that State workers compensation laws
have on small insurers and workers compensation carriers
in the terrorism risk insurance marketplace.
‘‘(2) REPORT.—The Secretary shall submit a report to the
Congress setting forth the findings and conclusions of each
study required under paragraph (1).’’.

TITLE II—NATIONAL ASSOCIATION OF
REGISTERED AGENTS AND BROKERS
REFORM
SEC. 201. SHORT TITLE.

This title may be cited as the ‘‘National Association of Registered Agents and Brokers Reform Act of 2015’’.
SEC. 202. REESTABLISHMENT OF THE NATIONAL ASSOCIATION OF
REGISTERED AGENTS AND BROKERS.

(a) IN GENERAL.—Subtitle C of title III of the Gramm-LeachBliley Act (15 U.S.C. 6751 et seq.) is amended to read as follows:

H. R. 26—11

‘‘Subtitle C—National Association of
Registered Agents and Brokers
‘‘SEC. 321. NATIONAL ASSOCIATION OF REGISTERED AGENTS AND BROKERS.

‘‘(a) ESTABLISHMENT.—There is established the National
Association of Registered Agents and Brokers (referred to in this
subtitle as the ‘Association’).
‘‘(b) STATUS.—The Association shall—
‘‘(1) be a nonprofit corporation;
‘‘(2) not be an agent or instrumentality of the Federal
Government;
‘‘(3) be an independent organization that may not be
merged with or into any other private or public entity; and
‘‘(4) except as otherwise provided in this subtitle, be subject
to, and have all the powers conferred upon, a nonprofit corporation by the District of Columbia Nonprofit Corporation Act
(D.C. Code, sec. 29–301.01 et seq.) or any successor thereto.
‘‘SEC. 322. PURPOSE.

‘‘The purpose of the Association shall be to provide a mechanism
through which licensing, continuing education, and other nonresident insurance producer qualification requirements and conditions may be adopted and applied on a multi-state basis without
affecting the laws, rules, and regulations, and preserving the rights
of a State, pertaining to—
‘‘(1) licensing, continuing education, and other qualification
requirements of insurance producers that are not members
of the Association;
‘‘(2) resident or nonresident insurance producer appointment requirements;
‘‘(3) supervising and disciplining resident and nonresident
insurance producers;
‘‘(4) establishing licensing fees for resident and nonresident
insurance producers so that there is no loss of insurance producer licensing revenue to the State; and
‘‘(5) prescribing and enforcing laws and regulations regulating the conduct of resident and nonresident insurance producers.
‘‘SEC. 323. MEMBERSHIP.

‘‘(a) ELIGIBILITY.—
‘‘(1) IN GENERAL.—Any insurance producer licensed in its
home State shall, subject to paragraphs (2) and (4), be eligible
to become a member of the Association.
‘‘(2) INELIGIBILITY FOR SUSPENSION OR REVOCATION OF
LICENSE.—Subject to paragraph (3), an insurance producer is
not eligible to become a member of the Association if a State
insurance regulator has suspended or revoked the insurance
license of the insurance producer in that State.
‘‘(3) RESUMPTION OF ELIGIBILITY.—Paragraph (2) shall cease
to apply to any insurance producer if—
‘‘(A) the State insurance regulator reissues or renews
the license of the insurance producer in the State in which
the license was suspended or revoked, or otherwise terminates or vacates the suspension or revocation; or

H. R. 26—12
‘‘(B) the suspension or revocation expires or is subsequently overturned by a court of competent jurisdiction.
‘‘(4) CRIMINAL HISTORY RECORD CHECK REQUIRED.—
‘‘(A) IN GENERAL.—An insurance producer who is an
individual shall not be eligible to become a member of
the Association unless the insurance producer has undergone a criminal history record check that complies with
regulations prescribed by the Attorney General of the
United States under subparagraph (K).
‘‘(B) CRIMINAL HISTORY RECORD CHECK REQUESTED BY
HOME STATE.—An insurance producer who is licensed in
a State and who has undergone a criminal history record
check during the 2-year period preceding the date of
submission of an application to become a member of the
Association, in compliance with a requirement to undergo
such criminal history record check as a condition for such
licensure in the State, shall be deemed to have undergone
a criminal history record check for purposes of subparagraph (A).
‘‘(C) CRIMINAL HISTORY RECORD CHECK REQUESTED BY
ASSOCIATION.—
‘‘(i) IN GENERAL.—The Association shall, upon
request by an insurance producer licensed in a State,
submit fingerprints or other identification information
obtained from the insurance producer, and a request
for a criminal history record check of the insurance
producer, to the Federal Bureau of Investigation.
‘‘(ii) PROCEDURES.—The board of directors of the
Association (referred to in this subtitle as the ‘Board’)
shall prescribe procedures for obtaining and utilizing
fingerprints or other identification information and
criminal history record information, including the
establishment of reasonable fees to defray the expenses
of the Association in connection with the performance
of a criminal history record check and appropriate
safeguards for maintaining confidentiality and security
of the information. Any fees charged pursuant to this
clause shall be separate and distinct from those
charged by the Attorney General pursuant to subparagraph (I).
‘‘(D) FORM OF REQUEST.—A submission under subparagraph (C)(i) shall include such fingerprints or other identification information as is required by the Attorney General
concerning the person about whom the criminal history
record check is requested, and a statement signed by the
person authorizing the Attorney General to provide the
information to the Association and for the Association to
receive the information.
‘‘(E) PROVISION OF INFORMATION BY ATTORNEY GENERAL.—Upon receiving a submission under subparagraph
(C)(i) from the Association, the Attorney General shall
search all criminal history records of the Federal Bureau
of Investigation, including records of the Criminal Justice
Information Services Division of the Federal Bureau of
Investigation, that the Attorney General determines appropriate for criminal history records corresponding to the
fingerprints or other identification information provided

H. R. 26—13
under subparagraph (D) and provide all criminal history
record information included in the request to the Association.
‘‘(F) LIMITATION ON PERMISSIBLE USES OF INFORMATION.—Any information provided to the Association under
subparagraph (E) may only—
‘‘(i) be used for purposes of determining compliance
with membership criteria established by the Association;
‘‘(ii) be disclosed to State insurance regulators,
or Federal or State law enforcement agencies, in
conformance with applicable law; or
‘‘(iii) be disclosed, upon request, to the insurance
producer to whom the criminal history record information relates.
‘‘(G) PENALTY FOR IMPROPER USE OR DISCLOSURE.—
Whoever knowingly uses any information provided under
subparagraph (E) for a purpose not authorized in subparagraph (F), or discloses any such information to anyone
not authorized to receive it, shall be fined not more than
$50,000 per violation as determined by a court of competent
jurisdiction.
‘‘(H) RELIANCE ON INFORMATION.—Neither the Association nor any of its Board members, officers, or employees
shall be liable in any action for using information provided
under subparagraph (E) as permitted under subparagraph
(F) in good faith and in reasonable reliance on its accuracy.
‘‘(I) FEES.—The Attorney General may charge a reasonable fee for conducting the search and providing the
information under subparagraph (E), and any such fee
shall be collected and remitted by the Association to the
Attorney General.
‘‘(J) RULE OF CONSTRUCTION.—Nothing in this paragraph shall be construed as—
‘‘(i) requiring a State insurance regulator to perform criminal history record checks under this section;
or
‘‘(ii) limiting any other authority that allows access
to criminal history records.
‘‘(K) REGULATIONS.—The Attorney General shall prescribe regulations to carry out this paragraph, which shall
include—
‘‘(i) appropriate protections for ensuring the confidentiality of information provided under subparagraph (E); and
‘‘(ii) procedures providing a reasonable opportunity
for an insurance producer to contest the accuracy of
information regarding the insurance producer provided
under subparagraph (E).
‘‘(L) INELIGIBILITY FOR MEMBERSHIP.—
‘‘(i) IN GENERAL.—The Association may, under
reasonably consistently applied standards, deny membership to an insurance producer on the basis of
criminal history record information provided under
subparagraph (E), or where the insurance producer
has been subject to disciplinary action, as described
in paragraph (2).

H. R. 26—14
‘‘(ii) RIGHTS OF APPLICANTS DENIED MEMBERSHIP.—
The Association shall notify any insurance producer
who is denied membership on the basis of criminal
history record information provided under subparagraph (E) of the right of the insurance producer to—
‘‘(I) obtain a copy of all criminal history record
information provided to the Association under
subparagraph (E) with respect to the insurance
producer; and
‘‘(II) challenge the denial of membership based
on the accuracy and completeness of the information.
‘‘(M) DEFINITION.—For purposes of this paragraph, the
term ‘criminal history record check’ means a national background check of criminal history records of the Federal
Bureau of Investigation.
‘‘(b) AUTHORITY TO ESTABLISH MEMBERSHIP CRITERIA.—The
Association may establish membership criteria that bear a reasonable relationship to the purposes for which the Association was
established.
‘‘(c) ESTABLISHMENT OF CLASSES AND CATEGORIES OF MEMBERSHIP.—
‘‘(1) CLASSES OF MEMBERSHIP.—The Association may establish separate classes of membership, with separate criteria,
if the Association reasonably determines that performance of
different duties requires different levels of education, training,
experience, or other qualifications.
‘‘(2) BUSINESS ENTITIES.—The Association shall establish
a class of membership and membership criteria for business
entities. A business entity that applies for membership shall
be required to designate an individual Association member
responsible for the compliance of the business entity with
Association standards and the insurance laws, standards, and
regulations of any State in which the business entity seeks
to do business on the basis of Association membership.
‘‘(3) CATEGORIES.—
‘‘(A) SEPARATE CATEGORIES FOR INSURANCE PRODUCERS
PERMITTED.—The Association may establish separate categories of membership for insurance producers and for
other persons or entities within each class, based on the
types of licensing categories that exist under State laws.
‘‘(B) SEPARATE TREATMENT FOR DEPOSITORY INSTITUTIONS PROHIBITED.—No special categories of membership,
and no distinct membership criteria, shall be established
for members that are depository institutions or for
employees, agents, or affiliates of depository institutions.
‘‘(d) MEMBERSHIP CRITERIA.—
‘‘(1) IN GENERAL.—The Association may establish criteria
for membership which shall include standards for personal
qualifications, education, training, and experience. The Association shall not establish criteria that unfairly limit the ability
of a small insurance producer to become a member of the
Association, including imposing discriminatory membership
fees.
‘‘(2) QUALIFICATIONS.—In establishing criteria under paragraph (1), the Association shall not adopt any qualification
less protective to the public than that contained in the National

H. R. 26—15
Association of Insurance Commissioners (referred to in this
subtitle as the ‘NAIC’) Producer Licensing Model Act in effect
as of the date of enactment of the National Association of
Registered Agents and Brokers Reform Act of 2015, and shall
consider the highest levels of insurance producer qualifications
established under the licensing laws of the States.
‘‘(3) ASSISTANCE FROM STATES.—
‘‘(A) IN GENERAL.—The Association may request a State
to provide assistance in investigating and evaluating the
eligibility of a prospective member for membership in the
Association.
‘‘(B) AUTHORIZATION OF INFORMATION SHARING.—A
submission under subsection (a)(4)(C)(i) made by an insurance producer licensed in a State shall include a statement
signed by the person about whom the assistance is
requested authorizing—
‘‘(i) the State to share information with the
Association; and
‘‘(ii) the Association to receive the information.
‘‘(C) RULE OF CONSTRUCTION.—Subparagraph (A) shall
not be construed as requiring or authorizing any State
to adopt new or additional requirements concerning the
licensing or evaluation of insurance producers.
‘‘(4) DENIAL OF MEMBERSHIP.—The Association may, based
on reasonably consistently applied standards, deny membership
to any State-licensed insurance producer for failure to meet
the membership criteria established by the Association.
‘‘(e) EFFECT OF MEMBERSHIP.—
‘‘(1) AUTHORITY OF ASSOCIATION MEMBERS.—Membership
in the Association shall—
‘‘(A) authorize an insurance producer to sell, solicit,
or negotiate insurance in any State for which the member
pays the licensing fee set by the State for any line or
lines of insurance specified in the home State license of
the insurance producer, and exercise all such incidental
powers as shall be necessary to carry out such activities,
including claims adjustments and settlement to the extent
permissible under the laws of the State, risk management,
employee benefits advice, retirement planning, and any
other insurance-related consulting activities;
‘‘(B) be the equivalent of a nonresident insurance producer license for purposes of authorizing the insurance
producer to engage in the activities described in subparagraph (A) in any State where the member pays the licensing
fee; and
‘‘(C) be the equivalent of a nonresident insurance producer license for the purpose of subjecting an insurance
producer to all laws, regulations, provisions or other action
of any State concerning revocation, suspension, or other
enforcement action related to the ability of a member to
engage in any activity within the scope of authority granted
under this subsection and to all State laws, regulations,
provisions, and actions preserved under paragraph (5).
‘‘(2) VIOLENT CRIME CONTROL AND LAW ENFORCEMENT ACT
OF 1994.—Nothing in this subtitle shall be construed to alter,
modify, or supercede any requirement established by section
1033 of title 18, United States Code.

H. R. 26—16
‘‘(3) AGENT FOR REMITTING FEES.—The Association shall
act as an agent for any member for purposes of remitting
licensing fees to any State pursuant to paragraph (1).
‘‘(4) NOTIFICATION OF ACTION.—
‘‘(A) IN GENERAL.—The Association shall notify the
States (including State insurance regulators) and the NAIC
when an insurance producer has satisfied the membership
criteria of this section. The States (including State insurance regulators) shall have 10 business days after the
date of the notification in order to provide the Association
with evidence that the insurance producer does not satisfy
the criteria for membership in the Association.
‘‘(B) ONGOING DISCLOSURES REQUIRED.—On an ongoing
basis, the Association shall disclose to the States (including
State insurance regulators) and the NAIC a list of the
States in which each member is authorized to operate.
The Association shall immediately notify the States
(including State insurance regulators) and the NAIC when
a member is newly authorized to operate in one or more
States, or is no longer authorized to operate in one or
more States on the basis of Association membership.
‘‘(5) PRESERVATION OF CONSUMER PROTECTION AND MARKET
CONDUCT REGULATION.—
‘‘(A) IN GENERAL.—No provision of this section shall
be construed as altering or affecting the applicability or
continuing effectiveness of any law, regulation, provision,
or other action of any State, including those described
in subparagraph (B), to the extent that the State law,
regulation, provision, or other action is not inconsistent
with the provisions of this subtitle related to market entry
for nonresident insurance producers, and then only to the
extent of the inconsistency.
‘‘(B) PRESERVED REGULATIONS.—The laws, regulations,
provisions, or other actions of any State referred to in
subparagraph (A) include laws, regulations, provisions, or
other actions that—
‘‘(i) regulate market conduct, insurance producer
conduct, or unfair trade practices;
‘‘(ii) establish consumer protections; or
‘‘(iii) require insurance producers to be appointed
by a licensed or authorized insurer.
‘‘(f) BIENNIAL RENEWAL.—Membership in the Association shall
be renewed on a biennial basis.
‘‘(g) CONTINUING EDUCATION.—
‘‘(1) IN GENERAL.—The Association shall establish, as a
condition of membership, continuing education requirements
which shall be comparable to the continuing education requirements under the licensing laws of a majority of the States.
‘‘(2) STATE CONTINUING EDUCATION REQUIREMENTS.—A
member may not be required to satisfy continuing education
requirements imposed under the laws, regulations, provisions,
or actions of any State other than the home State of the
member.
‘‘(3) RECIPROCITY.—The Association shall not require a
member to satisfy continuing education requirements that are
equivalent to any continuing education requirements of the

H. R. 26—17
home State of the member that have been satisfied by the
member during the applicable licensing period.
‘‘(4) LIMITATION ON THE ASSOCIATION.—The Association
shall not directly or indirectly offer any continuing education
courses for insurance producers.
‘‘(h) PROBATION, SUSPENSION AND REVOCATION.—
‘‘(1) DISCIPLINARY ACTION.—The Association may place an
insurance producer that is a member of the Association on
probation or suspend or revoke the membership of the insurance
producer in the Association, or assess monetary fines or penalties, as the Association determines to be appropriate, if—
‘‘(A) the insurance producer fails to meet the applicable
membership criteria or other standards established by the
Association;
‘‘(B) the insurance producer has been subject to disciplinary action pursuant to a final adjudicatory proceeding
under the jurisdiction of a State insurance regulator;
‘‘(C) an insurance license held by the insurance producer has been suspended or revoked by a State insurance
regulator; or
‘‘(D) the insurance producer has been convicted of a
crime that would have resulted in the denial of membership
pursuant to subsection (a)(4)(L)(i) at the time of application,
and the Association has received a copy of the final disposition from a court of competent jurisdiction.
‘‘(2) VIOLATIONS OF ASSOCIATION STANDARDS.—The Association shall have the power to investigate alleged violations of
Association standards.
‘‘(3) REPORTING.—The Association shall immediately notify
the States (including State insurance regulators) and the NAIC
when the membership of an insurance producer has been placed
on probation or has been suspended, revoked, or otherwise
terminated, or when the Association has assessed monetary
fines or penalties.
‘‘(i) CONSUMER COMPLAINTS.—
‘‘(1) IN GENERAL.—The Association shall—
‘‘(A) refer any complaint against a member of the
Association from a consumer relating to alleged misconduct
or violations of State insurance laws to the State insurance
regulator where the consumer resides and, when appropriate, to any additional State insurance regulator, as
determined by standards adopted by the Association; and
‘‘(B) make any related records and information available to each State insurance regulator to whom the complaint is forwarded.
‘‘(2) TELEPHONE AND OTHER ACCESS.—The Association shall
maintain a toll-free number for purposes of this subsection
and, as practicable, other alternative means of communication
with consumers, such as an Internet webpage.
‘‘(3) FINAL DISPOSITION OF INVESTIGATION.—State insurance
regulators shall provide the Association with information
regarding the final disposition of a complaint referred pursuant
to paragraph (1)(A), but nothing shall be construed to compel
a State to release confidential investigation reports or other
information protected by State law to the Association.
‘‘(j) INFORMATION SHARING.—The Association may—

H. R. 26—18
‘‘(1) share documents, materials, or other information,
including confidential and privileged documents, with a State,
Federal, or international governmental entity or with the NAIC
or other appropriate entity referred to paragraphs (3) and (4),
provided that the recipient has the authority and agrees to
maintain the confidentiality or privileged status of the document, material, or other information;
‘‘(2) limit the sharing of information as required under
this subtitle with the NAIC or any other non-governmental
entity, in circumstances under which the Association determines that the sharing of such information is unnecessary
to further the purposes of this subtitle;
‘‘(3) establish a central clearinghouse, or utilize the NAIC
or another appropriate entity, as determined by the Association,
as a central clearinghouse, for use by the Association and
the States (including State insurance regulators), through
which members of the Association may disclose their intent
to operate in 1 or more States and pay the licensing fees
to the appropriate States; and
‘‘(4) establish a database, or utilize the NAIC or another
appropriate entity, as determined by the Association, as a database, for use by the Association and the States (including
State insurance regulators) for the collection of regulatory
information concerning the activities of insurance producers.
‘‘(k) EFFECTIVE DATE.—The provisions of this section shall take
effect on the later of—
‘‘(1) the expiration of the 2-year period beginning on the
date of enactment of the National Association of Registered
Agents and Brokers Reform Act of 2015; and
‘‘(2) the date of incorporation of the Association.
‘‘SEC. 324. BOARD OF DIRECTORS.

‘‘(a) ESTABLISHMENT.—There is established a board of directors
of the Association, which shall have authority to govern and supervise all activities of the Association.
‘‘(b) POWERS.—The Board shall have such of the powers and
authority of the Association as may be specified in the bylaws
of the Association.
‘‘(c) COMPOSITION.—
‘‘(1) IN GENERAL.—The Board shall consist of 13 members
who shall be appointed by the President, by and with the
advice and consent of the Senate, in accordance with the procedures established under Senate Resolution 116 of the 112th
Congress, of whom—
‘‘(A) 8 shall be State insurance commissioners
appointed in the manner provided in paragraph (2), 1 of
whom shall be designated by the President to serve as
the chairperson of the Board until the Board elects one
such State insurance commissioner Board member to serve
as the chairperson of the Board;
‘‘(B) 3 shall have demonstrated expertise and experience with property and casualty insurance producer
licensing; and
‘‘(C) 2 shall have demonstrated expertise and experience with life or health insurance producer licensing.
‘‘(2) STATE INSURANCE REGULATOR REPRESENTATIVES.—

H. R. 26—19
‘‘(A) RECOMMENDATIONS.—Before making any appointments pursuant to paragraph (1)(A), the President shall
request a list of recommended candidates from the States
through the NAIC, which shall not be binding on the President. If the NAIC fails to submit a list of recommendations
not later than 15 business days after the date of the
request, the President may make the requisite appointments without considering the views of the NAIC.
‘‘(B) POLITICAL AFFILIATION.—Not more than 4 Board
members appointed under paragraph (1)(A) shall belong
to the same political party.
‘‘(C) FORMER STATE INSURANCE COMMISSIONERS.—
‘‘(i) IN GENERAL.—If, after offering each currently
serving State insurance commissioner an appointment
to the Board, fewer than 8 State insurance commissioners have accepted appointment to the Board, the
President may appoint the remaining State insurance
commissioner Board members, as required under paragraph (1)(A), of the appropriate political party as
required under subparagraph (B), from among individuals who are former State insurance commissioners.
‘‘(ii) LIMITATION.—A former State insurance
commissioner appointed as described in clause (i) may
not be employed by or have any present direct or
indirect financial interest in any insurer, insurance
producer, or other entity in the insurance industry,
other than direct or indirect ownership of, or beneficial
interest in, an insurance policy or annuity contract
written or sold by an insurer.
‘‘(D) SERVICE THROUGH TERM.—If a Board member
appointed under paragraph (1)(A) ceases to be a State
insurance commissioner during the term of the Board
member, the Board member shall cease to be a Board
member.
‘‘(3) PRIVATE SECTOR REPRESENTATIVES.—In making any
appointment pursuant to subparagraph (B) or (C) of paragraph
(1), the President may seek recommendations for candidates
from groups representing the category of individuals described,
which shall not be binding on the President.
‘‘(4) STATE INSURANCE COMMISSIONER DEFINED.—For purposes of this subsection, the term ‘State insurance commissioner’ means a person who serves in the position in State
government, or on the board, commission, or other body that
is the primary insurance regulatory authority for the State.
‘‘(d) TERMS.—
‘‘(1) IN GENERAL.—Except as provided under paragraph
(2), the term of service for each Board member shall be 2
years.
‘‘(2) EXCEPTIONS.—
‘‘(A) 1-YEAR TERMS.—The term of service shall be 1
year, as designated by the President at the time of the
nomination of the subject Board members for—
‘‘(i) 4 of the State insurance commissioner Board
members initially appointed under paragraph (1)(A),
of whom not more than 2 shall belong to the same
political party;

H. R. 26—20
‘‘(ii) 1 of the Board members initially appointed
under paragraph (1)(B); and
‘‘(iii) 1 of the Board members initially appointed
under paragraph (1)(C).
‘‘(B) EXPIRATION OF TERM.—A Board member may continue to serve after the expiration of the term to which
the Board member was appointed for the earlier of 2 years
or until a successor is appointed.
‘‘(C) MID-TERM APPOINTMENTS.—A Board member
appointed to fill a vacancy occurring before the expiration
of the term for which the predecessor of the Board member
was appointed shall be appointed only for the remainder
of that term.
‘‘(3) SUCCESSIVE TERMS.—Board members may be reappointed to successive terms.
‘‘(e) INITIAL APPOINTMENTS.—The appointment of initial Board
members shall be made no later than 90 days after the date of
enactment of the National Association of Registered Agents and
Brokers Reform Act of 2015.
‘‘(f) MEETINGS.—
‘‘(1) IN GENERAL.—The Board shall meet—
‘‘(A) at the call of the chairperson;
‘‘(B) as requested in writing to the chairperson by
not fewer than 5 Board members; or
‘‘(C) as otherwise provided by the bylaws of the Association.
‘‘(2) QUORUM REQUIRED.—A majority of all Board members
shall constitute a quorum.
‘‘(3) VOTING.—Decisions of the Board shall require the
approval of a majority of all Board members present at a
meeting, a quorum being present.
‘‘(4) INITIAL MEETING.—The Board shall hold its first
meeting not later than 45 days after the date on which all
initial Board members have been appointed.
‘‘(g) RESTRICTION ON CONFIDENTIAL INFORMATION.—Board
members appointed pursuant to subparagraphs (B) and (C) of subsection (c)(1) shall not have access to confidential information
received by the Association in connection with complaints, investigations, or disciplinary proceedings involving insurance producers.
‘‘(h) ETHICS AND CONFLICTS OF INTEREST.—The Board shall
issue and enforce an ethical conduct code to address permissible
and prohibited activities of Board members and Association officers,
employees, agents, or consultants. The code shall, at a minimum,
include provisions that prohibit any Board member or Association
officer, employee, agent or consultant from—
‘‘(1) engaging in unethical conduct in the course of performing Association duties;
‘‘(2) participating in the making or influencing the making
of any Association decision, the outcome of which the Board
member, officer, employee, agent, or consultant knows or had
reason to know would have a reasonably foreseeable material
financial effect, distinguishable from its effect on the public
generally, on the person or a member of the immediate family
of the person;
‘‘(3) accepting any gift from any person or entity other
than the Association that is given because of the position held
by the person in the Association;

H. R. 26—21
‘‘(4) making political contributions to any person or entity
on behalf of the Association; and
‘‘(5) lobbying or paying a person to lobby on behalf of
the Association.
‘‘(i) COMPENSATION.—
‘‘(1) IN GENERAL.—Except as provided in paragraph (2),
no Board member may receive any compensation from the
Association or any other person or entity on account of Board
membership.
‘‘(2) TRAVEL EXPENSES AND PER DIEM.—Board members may
be reimbursed only by the Association for travel expenses,
including per diem in lieu of subsistence, at rates consistent
with rates authorized for employees of Federal agencies under
subchapter I of chapter 57 of title 5, United States Code,
while away from home or regular places of business in performance of services for the Association.
‘‘SEC. 325. BYLAWS, STANDARDS, AND DISCIPLINARY ACTIONS.

‘‘(a) ADOPTION AND AMENDMENT OF BYLAWS AND STANDARDS.—
‘‘(1) PROCEDURES.—The Association shall adopt procedures
for the adoption of bylaws and standards that are similar
to procedures under subchapter II of chapter 5 of title 5, United
States Code (commonly known as the ‘Administrative Procedure
Act’).
‘‘(2) COPY REQUIRED TO BE FILED.—The Board shall submit
to the President, through the Department of the Treasury,
and the States (including State insurance regulators), and shall
publish on the website of the Association, all proposed bylaws
and standards of the Association, or any proposed amendment
to the bylaws or standards of the Association, accompanied
by a concise general statement of the basis and purpose of
such proposal.
‘‘(3) EFFECTIVE DATE.—Any proposed bylaw or standard
of the Association, and any proposed amendment to the bylaws
or standards of the Association, shall take effect, after notice
under paragraph (2) and opportunity for public comment, on
such date as the Association may designate, unless suspended
under section 329(c).
‘‘(4) RULE OF CONSTRUCTION.—Nothing in this section shall
be construed to subject the Board or the Association to the
requirements of subchapter II of chapter 5 of title 5, United
States Code (commonly known as the ‘Administrative Procedure
Act’).
‘‘(b) DISCIPLINARY ACTION BY THE ASSOCIATION.—
‘‘(1) SPECIFICATION OF CHARGES.—In any proceeding to
determine whether membership shall be denied, suspended,
revoked, or not renewed, or to determine whether a member
of the Association should be placed on probation (referred to
in this section as a ‘disciplinary action’) or whether to assess
fines or monetary penalties, the Association shall bring specific
charges, notify the member of the charges, give the member
an opportunity to defend against the charges, and keep a record.
‘‘(2) SUPPORTING STATEMENT.—A determination to take disciplinary action shall be supported by a statement setting
forth—
‘‘(A) any act or practice in which the member has
been found to have been engaged;

H. R. 26—22
‘‘(B) the specific provision of this subtitle or standard
of the Association that any such act or practice is deemed
to violate; and
‘‘(C) the sanction imposed and the reason for the sanction.
‘‘(3) INELIGIBILITY OF PRIVATE SECTOR REPRESENTATIVES.—
Board members appointed pursuant to section 324(c)(3) may
not—
‘‘(A) participate in any disciplinary action or be counted
toward establishing a quorum during a disciplinary action;
and
‘‘(B) have access to confidential information concerning
any disciplinary action.
‘‘SEC. 326. POWERS.

‘‘In addition to all the powers conferred upon a nonprofit corporation by the District of Columbia Nonprofit Corporation Act,
the Association shall have the power to—
‘‘(1) establish and collect such membership fees as the
Association finds necessary to impose to cover the costs of
its operations;
‘‘(2) adopt, amend, and repeal bylaws, procedures, or standards governing the conduct of Association business and performance of its duties;
‘‘(3) establish procedures for providing notice and opportunity for comment pursuant to section 325(a);
‘‘(4) enter into and perform such agreements as necessary
to carry out the duties of the Association;
‘‘(5) hire employees, professionals, or specialists, and elect
or appoint officers, and to fix their compensation, define their
duties and give them appropriate authority to carry out the
purposes of this subtitle, and determine their qualification;
‘‘(6) establish personnel policies of the Association and programs relating to, among other things, conflicts of interest,
rates of compensation, where applicable, and qualifications of
personnel;
‘‘(7) borrow money; and
‘‘(8) secure funding for such amounts as the Association
determines to be necessary and appropriate to organize and
begin operations of the Association, which shall be treated
as loans to be repaid by the Association with interest at market
rate.
‘‘SEC. 327. REPORT BY THE ASSOCIATION.

‘‘(a) IN GENERAL.—As soon as practicable after the close of
each fiscal year, the Association shall submit to the President,
through the Department of the Treasury, and the States (including
State insurance regulators), and shall publish on the website of
the Association, a written report regarding the conduct of its business, and the exercise of the other rights and powers granted
by this subtitle, during such fiscal year.
‘‘(b) FINANCIAL STATEMENTS.—Each report submitted under
subsection (a) with respect to any fiscal year shall include audited
financial statements setting forth the financial position of the
Association at the end of such fiscal year and the results of its
operations (including the source and application of its funds) for
such fiscal year.

H. R. 26—23
‘‘SEC. 328. LIABILITY OF THE ASSOCIATION AND THE BOARD MEMBERS,
OFFICERS, AND EMPLOYEES OF THE ASSOCIATION.

‘‘(a) IN GENERAL.—The Association shall not be deemed to
be an insurer or insurance producer within the meaning of any
State law, rule, regulation, or order regulating or taxing insurers,
insurance producers, or other entities engaged in the business of
insurance, including provisions imposing premium taxes, regulating
insurer solvency or financial condition, establishing guaranty funds
and levying assessments, or requiring claims settlement practices.
‘‘(b) LIABILITY OF BOARD MEMBERS, OFFICERS, AND
EMPLOYEES.—No Board member, officer, or employee of the Association shall be personally liable to any person for any action taken
or omitted in good faith in any matter within the scope of their
responsibilities in connection with the Association.
‘‘SEC. 329. PRESIDENTIAL OVERSIGHT.

‘‘(a) REMOVAL OF BOARD.—If the President determines that
the Association is acting in a manner contrary to the interests
of the public or the purposes of this subtitle or has failed to
perform its duties under this subtitle, the President may remove
the entire existing Board for the remainder of the term to which
the Board members were appointed and appoint, in accordance
with section 324 and with the advice and consent of the Senate,
in accordance with the procedures established under Senate Resolution 116 of the 112th Congress, new Board members to fill the
vacancies on the Board for the remainder of the terms.
‘‘(b) REMOVAL OF BOARD MEMBER.—The President may remove
a Board member only for neglect of duty or malfeasance in office.
‘‘(c) SUSPENSION OF BYLAWS AND STANDARDS AND PROHIBITION
OF ACTIONS.—Following notice to the Board, the President, or a
person designated by the President for such purpose, may suspend
the effectiveness of any bylaw or standard, or prohibit any action,
of the Association that the President or the designee determines
is contrary to the purposes of this subtitle.
‘‘SEC. 330. RELATIONSHIP TO STATE LAW.

‘‘(a) PREEMPTION OF STATE LAWS.—State laws, regulations,
provisions, or other actions purporting to regulate insurance producers shall be preempted to the extent provided in subsection
(b).
‘‘(b) PROHIBITED ACTIONS.—
‘‘(1) IN GENERAL.—No State shall—
‘‘(A) impede the activities of, take any action against,
or apply any provision of law or regulation arbitrarily
or discriminatorily to, any insurance producer because that
insurance producer or any affiliate plans to become, has
applied to become, or is a member of the Association;
‘‘(B) impose any requirement upon a member of the
Association that it pay fees different from those required
to be paid to that State were it not a member of the
Association; or
‘‘(C) impose any continuing education requirements on
any nonresident insurance producer that is a member of
the Association.
‘‘(2) STATES OTHER THAN A HOME STATE.—No State, other
than the home State of a member of the Association, shall—

H. R. 26—24
‘‘(A) impose any licensing, personal or corporate qualifications, education, training, experience, residency, continuing education, or bonding requirement upon a member
of the Association that is different from the criteria for
membership in the Association or renewal of such membership;
‘‘(B) impose any requirement upon a member of the
Association that it be licensed, registered, or otherwise
qualified to do business or remain in good standing in
the State, including any requirement that the insurance
producer register as a foreign company with the secretary
of state or equivalent State official;
‘‘(C) require that a member of the Association submit
to a criminal history record check as a condition of doing
business in the State; or
‘‘(D) impose any licensing, registration, or appointment
requirements upon a member of the Association, or require
a member of the Association to be authorized to operate
as an insurance producer, in order to sell, solicit, or negotiate insurance for commercial property and casualty risks
to an insured with risks located in more than one State,
if the member is licensed or otherwise authorized to operate
in the State where the insured maintains its principal
place of business and the contract of insurance insures
risks located in that State.
‘‘(3) PRESERVATION OF STATE DISCIPLINARY AUTHORITY.—
Nothing in this section may be construed to prohibit a State
from investigating and taking appropriate disciplinary action,
including suspension or revocation of authority of an insurance
producer to do business in a State, in accordance with State
law and that is not inconsistent with the provisions of this
section, against a member of the Association as a result of
a complaint or for any alleged activity, regardless of whether
the activity occurred before or after the insurance producer
commenced doing business in the State pursuant to Association
membership.
‘‘SEC. 331. COORDINATION WITH FINANCIAL INDUSTRY REGULATORY
AUTHORITY.

‘‘The Association shall coordinate with the Financial Industry
Regulatory Authority in order to ease any administrative burdens
that fall on members of the Association that are subject to regulation by the Financial Industry Regulatory Authority, consistent
with the requirements of this subtitle and the Federal securities
laws.
‘‘SEC. 332. RIGHT OF ACTION.

‘‘(a) RIGHT OF ACTION.—Any person aggrieved by a decision
or action of the Association may, after reasonably exhausting available avenues for resolution within the Association, commence a
civil action in an appropriate United States district court, and
obtain all appropriate relief.
‘‘(b) ASSOCIATION INTERPRETATIONS.—In any action under subsection (a), the court shall give appropriate weight to the interpretation of the Association of its bylaws and standards and this subtitle.

H. R. 26—25
‘‘SEC. 333. FEDERAL FUNDING PROHIBITED.

‘‘The Association may not receive, accept, or borrow any
amounts from the Federal Government to pay for, or reimburse,
the Association for, the costs of establishing or operating the
Association.
‘‘SEC. 334. DEFINITIONS.

‘‘For purposes of this subtitle, the following definitions shall
apply:
‘‘(1) BUSINESS ENTITY.—The term ‘business entity’ means
a corporation, association, partnership, limited liability company, limited liability partnership, or other legal entity.
‘‘(2) DEPOSITORY INSTITUTION.—The term ‘depository
institution’ has the meaning as in section 3 of the Federal
Deposit Insurance Act (12 U.S.C. 1813).
‘‘(3) HOME STATE.—The term ‘home State’ means the State
in which the insurance producer maintains its principal place
of residence or business and is licensed to act as an insurance
producer.
‘‘(4) INSURANCE.—The term ‘insurance’ means any product,
other than title insurance or bail bonds, defined or regulated
as insurance by the appropriate State insurance regulatory
authority.
‘‘(5) INSURANCE PRODUCER.—The term ‘insurance producer’
means any insurance agent or broker, excess or surplus lines
broker or agent, insurance consultant, limited insurance representative, and any other individual or entity that sells,
solicits, or negotiates policies of insurance or offers advice,
counsel, opinions or services related to insurance.
‘‘(6) INSURER.—The term ‘insurer’ has the meaning as in
section 313(e)(2)(B) of title 31, United States Code.
‘‘(7) PRINCIPAL PLACE OF BUSINESS.—The term ‘principal
place of business’ means the State in which an insurance producer maintains the headquarters of the insurance producer
and, in the case of a business entity, where high-level officers
of the entity direct, control, and coordinate the business activities of the business entity.
‘‘(8) PRINCIPAL PLACE OF RESIDENCE.—The term ‘principal
place of residence’ means the State in which an insurance
producer resides for the greatest number of days during a
calendar year.
‘‘(9) STATE.—The term ‘State’ includes any State, the District of Columbia, any territory of the United States, and Puerto
Rico, Guam, American Samoa, the Trust Territory of the Pacific
Islands, the Virgin Islands, and the Northern Mariana Islands.
‘‘(10) STATE LAW.—
‘‘(A) IN GENERAL.—The term ‘State law’ includes all
laws, decisions, rules, regulations, or other State action
having the effect of law, of any State.
‘‘(B) LAWS APPLICABLE IN THE DISTRICT OF COLUMBIA.—
A law of the United States applicable only to or within
the District of Columbia shall be treated as a State law
rather than a law of the United States.’’.
(b) TECHNICAL AMENDMENT.—The table of contents for the
Gramm-Leach-Bliley Act is amended by striking the items relating
to subtitle C of title III and inserting the following new items:

H. R. 26—26
‘‘Sec.
‘‘Sec.
‘‘Sec.
‘‘Sec.
‘‘Sec.
‘‘Sec.
‘‘Sec.
‘‘Sec.
‘‘Sec.
‘‘Sec.
‘‘Sec.
‘‘Sec.
‘‘Sec.
‘‘Sec.

‘‘Subtitle C—National Association of Registered Agents and Brokers
321. National Association of Registered Agents and Brokers.
322. Purpose.
323. Membership.
324. Board of directors.
325. Bylaws, standards, and disciplinary actions.
326. Powers.
327. Report by the Association.
328. Liability of the Association and the Board members, officers, and employees of the Association.
329. Presidential oversight.
330. Relationship to State law.
331. Coordination with financial industry regulatory authority.
332. Right of action.
333. Federal funding prohibited.
334. Definitions.’’.

TITLE III—BUSINESS RISK MITIGATION
AND PRICE STABILIZATION
SEC. 301. SHORT TITLE.

This title may be cited as the ‘‘Business Risk Mitigation and
Price Stabilization Act of 2015’’.
SEC. 302. MARGIN REQUIREMENTS.

(a) COMMODITY EXCHANGE ACT AMENDMENT.—Section 4s(e) of
the Commodity Exchange Act (7 U.S.C. 6s(e)), as added by section
731 of the Dodd-Frank Wall Street Reform and Consumer Protection
Act, is amended by adding at the end the following new paragraph:
‘‘(4) APPLICABILITY WITH RESPECT TO COUNTERPARTIES.—
The requirements of paragraphs (2)(A)(ii) and (2)(B)(ii),
including the initial and variation margin requirements
imposed by rules adopted pursuant to paragraphs (2)(A)(ii)
and (2)(B)(ii), shall not apply to a swap in which a counterparty
qualifies for an exception under section 2(h)(7)(A), or an exemption issued under section 4(c)(1) from the requirements of section 2(h)(1)(A) for cooperative entities as defined in such exemption, or satisfies the criteria in section 2(h)(7)(D).’’.
(b) SECURITIES EXCHANGE ACT AMENDMENT.—Section 15F(e)
of the Securities Exchange Act of 1934 (15 U.S.C. 78o–10(e)), as
added by section 764(a) of the Dodd-Frank Wall Street Reform
and Consumer Protection Act, is amended by adding at the end
the following new paragraph:
‘‘(4) APPLICABILITY WITH RESPECT TO COUNTERPARTIES.—
The requirements of paragraphs (2)(A)(ii) and (2)(B)(ii) shall
not apply to a security-based swap in which a counterparty
qualifies for an exception under section 3C(g)(1) or satisfies
the criteria in section 3C(g)(4).’’.
SEC. 303. IMPLEMENTATION.

The amendments made by this title to the Commodity Exchange
Act shall be implemented—
(1) without regard to—
(A) chapter 35 of title 44, United States Code; and
(B) the notice and comment provisions of section 553
of title 5, United States Code;
(2) through the promulgation of an interim final rule,
pursuant to which public comment will be sought before a
final rule is issued; and

H. R. 26—27
(3) such that paragraph (1) shall apply solely to changes
to rules and regulations, or proposed rules and regulations,
that are limited to and directly a consequence of such amendments.

Speaker of the House of Representatives.

Vice President of the United States and
President of the Senate.