ICBA SUPPORTS OCC IN INSURANCE SPLIT
ICBA, along with the Massachusetts Bankers Association and other trade associations, has filed an industry amicus brief supporting OCC's preemption of Massachusetts insurance law that restricts bank sales of insurance.
Early this year, OCC ruled that under the standards adopted by Congress in the Gramm-Leach-Bliley Act, three provisions of Massachusetts law-that prohibit non-licensed bank personnel from referring customers to a licensed insurance agent unless the customer initiates the inquiry; prohibit non-licensed bank personnel from receiving any additional compensation for the referral; and prohibit banks from telling loan applicants that insurance is available through the bank until after the application is approved-are preempted by federal law and do not apply to national banks. GLBA bars states from preventing or significantly interfering with a bank's ability to sell, solicit or cross-market insurance.
The Massachusetts insurance and banking regulators have asked a federal appeals court to overturn OCC's interpretation.