A Brief History
Benjamin Franklin helped found the insurance industry in the United States in 1752 with the
Philadelphia Contributionship for the Insurance of Houses from Loss by Fire. The current state
insurance regulatory framework has its roots in the 19th century with New Hampshire appointing
the first insurance commissioner in 1851. Insurance regulatorsí responsibilities grew in scope
and complexity as the industry evolved. Congress adopted the McCarran-Ferguson Act in 1945
to declare that states should regulate the business of insurance and to affirm that the continued
regulation of the insurance industry by the states was in the publicís best interest.
The Financial Modernization Act of 1999also called Gramm-Leach-Blileyestablished a
comprehensive framework to permit affiliations among banks, securities firms and insurance
companies. Gramm-Leach-Bliley once again acknowledged that states should regulate the
business of insurance. However, Congress also called for state reform to allow insurance
companies to compete more effectively in the newly integrated financial service marketplace and
to respond with innovation and flexibility to evermore demanding consumer needsall while
continuing to protect consumers, which is the hallmark of state regulation.