Howard Metzenbaum

  • Why is this flimflammery allowed to continue?
  • Where are the laws to prevent companies from misleading people?  

--  Senator Metzenbaum

1993 -  GOV - When Will Policyholders Be Given The Truth About Life Insurance? 

First to comment was Sen. Howard Metzenbaum (D-Ohio):

  • He cited a report issued by the NAIC 13 years ago that reached many of the same conclusions, but the disclosure system it found to be "seriously flawed" was still in place today.

1993-3, NAIC Proceedings

1979 0524 - GOV - Cost Disclosure in Life Insurance - Metzenbaum - 279p

1992 0623 - GOV - Consumer Disclosure of Insurance 

1993 0525 -  GOV - When Will Policyholders Be Given The Truth About Life Insurance? - 354p

1993-Vol. IB  - NAIC - Metzenbaum Letter - 2 pages 810-811 

When will

Sioux City Journal from Sioux City, Iowa · 14

Almost 1 year ago, I chaired a hearing in this room looking at sales practices in the life insurance industry.

  • That hearing did not make the network news and was not broadcast by C-SPAN.
  • Put bluntly, it was a pretty dull hearing.  (p1)

--  Senator METZENBAUM

1993 -  GOV - When Will Policyholders Be Given The Truth About Life Insurance? - 354p

Opening Statement of Senator Metzenbaum

Senator METZENBAUM. Today the Subcommittee on Antitrust and
Monopoly begins its examination of cost disclosure in life insurance.

Life insurance is a tremendous business in this country.

  • Americans carry 140 million ordinary life policies, with nearly $1.3 trillion in coverage.
  • Cash-value life insurance accounts for more than 20 percent of total savings in this country-second only to deposits in savings and loan institutions.

The business of life insurance is presently exempt from the Federal antitrust laws under the McCarran-Ferguson Act.

  • It is the only major financial business without Federal regulation.
  • This is a unique situation.

It is fair to ask how well has the industry operated under this system.

  • Do consumers of insurance enjoy the benefits of competition?
  • Are consumers able without heroic efforts to find the best coverage for their needs at the lowest cost?
  • And are consumers able to readily understand precisely what kind of coverage they are buying?

My staff has conducted a major investigation of these issues.

  • I must say today that I was shocked when I saw its findings.  (p1)

1979 - Cost Disclosure in Life Insurance - Metzenbaum - 279p

LINDA M. LANKOWSKI: I think any way that we can make illustrations more understandable to the public is certainly going to help us.

  • We've seen the problems that have occurred when Senator Howard Metzenbaum (D--OH) was given an illustration with a vanishing premium, and he had absolutely no idea that he had bought a policy <Executive Life> that was not paid up in four years.
  • It caused many problems for the industry; it caused many problems because the press got involved, and the press doesn't understand the products as well as it thinks it does.


<Bonk: Connect with:

  • Legal Case - Video - 15-16740 Kamies Elhouty v. Lincoln Benefit Life Company -  Judge: there used to be cases...>

United States Court of Appeals, First Circuit

Richard DUHAIME, et al., Plaintiffs, Appellees, v. JOHN HANCOCK MUTUAL LIFE INSURANCE COMPANY, et al., Defendants, Appellees, Howard M. Metzenbaum, Appellant. - No. 98-2139. - Decided: June 28, 1999

Sen. Metzenbaum, known for his contentiousness on the floor of the Senate, addressed a luncheon audience at the National Press Club. He discussed the recent spate of financial crises in the insurance industry, such as the financial collapse of Executive Life Insurance company, which has left hundreds of thousands of policy holders in California and New York unsure of the state of their insurance coverage. 

Sen. Metzenbaum criticized state insurance regulators for failing to adequately maintain knowledge of the financial affairs of the insurance agency. He claimed insurance laws written by the insurance industry, inadequate staffing, infrequent examinations, inadequate capital regulation, and lack of coordination between the states are the reasons for the instability of the insurance industry.

He recounted several “accounting gimmicks” used by the insurance industry to appear financially solvent despite true financial instability

Senator METZENBAUM: Do you think these things are going to happen soon?
Ms. FAUCETT:  Well, I certainly hope they are going to happen in my lifetime.



  • I hope you have a long lifetime, but I sure hope that the insurance industry moves a lot faster than that, and I am not even talking about my lifetime.
  • I think yesterday was too late.
  • I think that for this industry to be guilty of such reprehensible
    practices and to sit on their hands and do nothing I just believe it is incredible.
  • The only reason they don't do something about it is because the American people don't know about it.
  • I am hopeful that as a result of these hearings they will know more, but I am a realist enough to know that 1 day's news story or commentary, or whatever, with respect to radio or TV does not cause these impregnable companies to move very rapidly.
  • I think it is shameful.
  • In your professional opinion, will this situation get worse for consumers if your recommendations are not adopted by the industry?

Ms. FAUCETT: I don't know that it will get worse, but certainly it
will not get any better.

1992 - GOV - Consumer Disclosure of Insurance 

Furthermore, the NAIC was being pushed by Senator Howard Metzenbaum who wanted to accuse the regulatory structure of not doing its job and then to bring regulation up to the federal level 

-- Frank S. Irish <ASB>

1996 -  Professional Standards Affecting Life Actuaries, Society of Actuaries

NAIC Legislative Outlook and Update
January 20 1994
Page 9

Senator Howard Metzenbaum D-OH who has reintroduced legislation to create federal regulatory agency responsible for insurance is in his final months in office.

  • Last year the Ohioan announced that he would not run for reelection in 1994.
  • He also introduced 1619 the Insurance Protection Act of 1993.
  • While Senator Metzenbaum has used his chairmanship of the Judiciary Subcommittee on Antitrust Business Rights and Monopolies to examine number of insurance-related issues including life policy illustrations, assumption reinsurance and guaranty finds his subcommittee does not have jurisdiction over insurance. 
  • The subcommittee that does have jurisdiction the Commerce Science and Transportation Subcommittee on Consumer has not announced any plans for hearings on the Metzenbaum bill. Indeed Senator Richard Bryan D-NV that panels chairman will probably wait to see what action if any the House might take on insurance regulation.
  • With strong possibility of congressional hearings looming in the background Senator Metzenbaum has written to the Securities and Exchange Commission SEC regarding the sales
    practices of the Metropolitan Life Insurance Company.
  • Senator Metzenbaums letter of December 17 is at Attachment number of states are examining the marketing of life insurance products as if they were retirement pension plans.
  • Indeed the NAIC has formed the EX Special Committee on Metropolitan Life to pursue these issues Senator Metzenbaum had planned to hold hearing on this issue on January 24 but has canceled it for later date.
  • His staff contemplates hearing with company officials as well as state insurance regulators testifying.
  • 1992 - GOV - Senate Document No. 19 -