A new front has opened in the ongoing battle over how much say international regulators should have in the operation of U.S.-domiciled insurers.

U.S. insurers have repeatedly raised questions about the ability of the International Association of Insurance Supervisors and other international regulatory groups to override state regulators.

Critics of the IAIS and other international regulators hold that global regulators don't understand that the U.S. regulatory system puts the interests of consumers ahead of others in matters such as solvency regulation, and do not appreciate the strengths of the state-based U.S. insurance regulatory system.

In response, Rep. Blaine Luetkemeyer, R-Mo., who also is chairman of the House Financial Services Committee's Subcommittee on Housing and Insurance, recently introduced the Transparent Insurance Standards Act.

According to a description on the congressman's website, H.R. 5143 “would reinforce that any international insurance standard agreed to at the IAIS would not be self-executing and could not be applied in the United States until it is implemented through the required domestic process and provides Congress the opportunity to reject a bad agreement.”

The measure would require the U.S. Treasury Department and Federal Reserve “to work to ensure policyholder protection, increased transparency and recognition of the state-based model of insurance regulation,” according to a statement on Rep. Luetkemeyer's website.

The Basel, Switzerland-based IAIS declined comment on the measure. A spokesman said in an email that the IAIS does not comment on pending legislation.

In the U.S., the National Association of Insurance Commissioners said in an emailed statement that it is reviewing the legislation.

“While we don't have a position at this time, we are generally supportive of more oversight of international discussions,” the NAIC said in the statement.

Some insurance groups hailed introduction of the bill.

“This is far and away our No. 1 issue,” said Nat Wienecke, senior vice president of federal government relations in the Washington office of the Property Casualty Insurers Association of America. “We're pleased that we've got a bipartisan bill in the Senate. We've got bipartisan interest in Chairman Luetkemeyer's bill, and we really think the time is ripe to put these guardrails up to preserve the 150-year-old state-based system.”

Even though the bill has been introduced during an election year, that does not doom its chances of winning approval of Congress, Mr. Wienecke said.

“Conventional wisdom says election years are hard to get things passed, but the data says that election years are some of the most productive years that Congress generally has,” Mr. Wienecke said.

Similar but not identical legislation has been introduced in the Senate, he said.

“I think Chairman Luetkemeyer's legislation is important because it sends a clear message that Congress will not allow ill-fitting one-size-fits-all regulatory standards conceived in Europe to be exported to the U.S. through an opaque international standards setting process,” said Jimi Grande, senior vice president of federal and political affairs at the National Association of Mutual Insurance Companies Washington office. “It also correctly reminds the Fed that it should complete its important work on a domestic capital standard before agreeing to any international capital standards.”

“I look at this from both a regulatory and legislative perspective,” said Howard Mills, global insurance regulatory leader at consultant Deloitte L.L.P. in New York. Mr. Mills, a former New York insurance superintendent and state legislator, said there's concern among U.S. lawmakers that the U.S. insurance industry is not always represented in international standard-setting forums. He said the concerns are shared at both the federal and state level.

“We're very supportive of transparency in international matters, and we think this proposal does bring some transparency,” said Frank Nutter, president of the Washington-based Reinsurance Association of America. But he also said the RAA is concerned whether the measure would hamstring regulators and the Federal Insurance Office in achieving regulatory goals.

The Washington-based American Insurance Association praised Rep. Luetkemeyer for being open to the insurance industry and other stakeholders in crafting the bill.

“We appreciate his thoughtfulness and look forward to working with him as this legislation goes forward,” said Wes McClelland, vice president of federal affairs at the AIA.