113:
established a separate insurance department or vested the power to regulate insurance in an existing agency. Shortly after that, other states followed until, by 1871, nearly every state had "some type of supervision and control over insurance companies." Often the legislation and rules promulgated by insurance commissions of one state conflicted with those of others. And in some cases, the rules that applied to out-of-state insurers deprived them of substantial rights. For example, one state required out-of-state insurers to post a bond that it would not appeal any case to the United States
Supreme Court.
728:
756:
742:
143:
The question in the case, which the Court formulated itself, was "whether the
Commerce Clause grants to Congress the power to regulate insurance transactions stretching across state lines." For nearly 80 years before then, the Supreme Court had consistently held that "Issuing a policy of insurance is
167:
argued that the writing of insurance in one state to cover risk in another was not "interstate commerce" as a constitutional matter and that the actions charged were not within the purview of the
Sherman Act. His opinion was largely based on the Court's previous decision on the negative implications
129:
In 1942, at the request of the
Attorney General of Missouri (whose insurance regulators felt powerless to correct abuses they had identified since 1922), the Department of Justice investigated and a grand jury in Georgia indicted the South-Eastern Underwriters Association, 27 of its officers and 198
192:
case, "insurance already was one of the most highly regulated industries in the
American economy," with every state having an insurance department and detailed laws on the protection of policyholders in case of insolvency. But regulation of other aspects of insurance varied widely among the states.
134:
to fix the premium rates on certain fire insurance policies and boycott non-complying independent sales agencies that did not comply; and (2) monopolization of markets for the sale of fire insurance policies in the states of
Alabama, Florida, Georgia, North Carolina, South Carolina, and Virginia in
139:
and dismissed the indictment, holding that "the business of insurance is not commerce, either intrastate or interstate" and that it "is not interstate commerce or interstate trade, though it might be considered a trade subject to local laws either State or
Federal, where the commerce clause is not
120:
of the federal constitution, regulation of it was exclusively given to the federal government. The United States
Supreme Court first decided a case on this basis in 1868, rejecting the insurers' argument in the context of an out-of-state insurer selling policies in another state For over 75 years,
88:
The McCarran–Ferguson Act does not itself regulate insurance, nor does it mandate that states regulate insurance. It provides that "Acts of
Congress" which do not expressly purport to regulate the "business of insurance" will not preempt state laws or regulations that regulate the "business of
112:
Until the middle of the 19th century, insurance largely went unregulated in the United States. In 1850, New
Hampshire was the first state to appoint an insurance commissioner. In 1852, Massachusetts appointed a commission, and California, Connecticut, Indiana, Missouri, New York, and Vermont
160:, reversed the district court, holding that (1) the Sherman Act intended to cover the alleged acts of monopolization; and (2) that the transaction of insurance across state lines was "commerce among the states" which the Constitution permitted Congress to regulate.
172:, in addition to concurring with the Chief Justice, urged the impracticality of allowing both state and federal regulation of insurance and, given the precedent, believed that it should be done by the states, at least absent a specific declaration by Congress.
197:
briefs supporting the decision of the district court. State insurance regulators and insurance executives complained to Congress that the decision would upset the extensive system of state regulation and taxation (as Justice Jackson had warned), even though
231:
is allowing interstate competition for health insurance, potentially requiring modification of the McCarran–Ferguson Act. In February 2010, the House of Representatives voted 406-19 to repeal the McCarran–Ferguson Act with regard to health insurance.
144:
not a transaction of commerce," "the business of insurance is not commerce," and "contracts of insurance are not commerce at all, neither state nor interstate." Those cases, however, dealt with the negative implications of the Commerce Clause,
701:
676:
116:
Insurers early attempted to oust states from regulation by using the constitutional argument that the business of insurance amounted to "Commerce …among the several states" and by virtue of the
887:
176:
allowed that Congress's power under the Commerce Clause reached these actions but argued that the Sherman Act was not an express warrant that Congress intended to enter this area of commerce.
41:
235:
The McCarran–Ferguson Act was amended in 2021 with the Competitive Health Insurance Reform Act of 2020, limiting the scope of exemptions for health insurance and dental insurance.
907:
897:
902:
628:
709:
152:
case, however, involved the question whether the business of insurance was "interstate commerce" sufficient to allow Congressional regulation. The Supreme Court, in
104:
remain prohibited regardless of state regulation. By contrast, most other federal laws will not apply to insurance whether the states regulate in that area or not.
92:
Specifically, concerning federal antitrust laws, it exempts the "business of insurance" as long as the state regulates in that area, with the proviso that cases of
680:
281:
381:
548:
449:
228:
882:
130:
member companies. The indictment charged the defendants with two counts of antitrust violations: (1) conspiracy under Section 1 of the
770:
188:
case in 1868, it had been widely believed that the federal government was excluded from regulating the insurance industry. Before the
36:
844:
Recommends that the McCarran–Ferguson Act be repealed and replaced with particular "safe harbor" exemptions from the antitrust laws.
260:
140:
the authority relied upon." In January 1955, the Supreme Court heard arguments on the prosecutors' appeal from the district court.
636:
73:
61:
651:
892:
877:
849:
800:
193:
The prospect of a federal take-over of insurance regulation alarmed state regulators, and thirty-five states had filed
832:
205:
In response to this decision, on March 9, 1945, Congress passed the McCarran–Ferguson Act, which, among other things:
32:
28:
209:
partially exempts insurance companies from the federal anti-trust legislation that applies to most businesses
148:, whether the business was "interstate commerce" such that the individual states could not regulate it. The
488:
Highsaw, Robert (December 1944). "Insurance As Interstate Commerce: An Analysis of the Underwriters Case".
733:
820:
569:
470:
302:
24:
35:
laws to a limited extent. The 79th Congress passed the McCarran–Ferguson Act in 1945 after the
256:
173:
169:
69:
50:
328:
812:
561:
462:
294:
774:
747:
164:
117:
46:
45:
that the federal government could regulate insurance companies under the authority of the
282:"McCarran-Ferguson Act's Antitrust Exemption for Insurance: Language, History and Policy"
833:"Comments to the Antitrust Modernization Commission Regarding the McCarran-Ferguson Act"
135:
violation of Section 2 of the Sherman Act. The district court sustained the defendants'
199:
31:
that exempts the business of insurance from most federal regulation, including federal
741:
121:
the Supreme Court rejected insurers' attempt to avoid state regulation on this basis.
871:
194:
793:
101:
57:
755:
677:"House Passes Bill To Repeal Antitrust Exemption For Health Insurance Companies"
131:
853:
761:
723:
157:
801:"McCarran-Ferguson Act Immunity from the Truth in Lending Act and Title VII"
771:"McCarran-Ferguson Act from Rupp's Insurance & Risk Management Glossary"
852:. National Underwriter Life & Health-Financial Services. Archived from
436:
New York Life Insurance Co. v. Deer Lodge County, 231 U.S. 495, 510 (1913).
708:. U.S Department of Justice Antitrust Division. 2021-03-24. Archived from
136:
97:
77:
824:
788:
573:
474:
306:
93:
53:
and that the federal antitrust laws applied to the insurance industry.
65:
816:
565:
466:
298:
349:
652:"Antitrust Exemption Repeal Resurfaces Amid ACA Battle - Law360"
702:"New Legislation Supports More Effective Antitrust Enforcement"
163:
The three judges who dissented did so for different reasons.
329:"Hearings before the Subcommittee on Antitrust and Monopoly"
382:"State Regulation of Property and Casualty Insurance Rates"
223:
Significance to U.S. health care reform in the 21st century
215:
allows states to establish mandatory licensing requirements
549:"Public Interest and the Commissioners'—All Industry Laws"
629:"Health insurance companies exempt from anti-trust laws"
412:
United States v. South-Eastern Underwriters Association
156:, 322 U.S. 533 (1944), 4-3 decision written by Justice
154:
United States v. South-Eastern Underwriters Association
42:
United States v. South-Eastern Underwriters Association
888:Healthcare reform legislation in the United States
547:
448:
380:
280:
450:"Regulation of Insurance under the McCarran Act"
255:(2 ed.). Detroit: Thomson/Gale. p. 3.
850:"The surprising history of McCarran-Ferguson"
8:
414:, 51 F. Supp. 712, 713, 714 (N.D. Ga. 1944).
908:United States federal insurance legislation
898:United States federal antitrust legislation
253:West's Encyclopedia of American Law, Vol. 7
108:Background of state regulation of insurance
903:United States federal commerce legislation
327:Senate Committee on the Judiciary (1960).
251:Lehman, Jeffrey; Phelps, Shirelle (2005).
218:preserves certain state laws of insurance.
789:Text of US vs. Southeastern Underwriters
274:
272:
773:. NILS Publishing. 2002. Archived from
614:
243:
227:One aspect of Republican proposals for
593:
362:
360:
358:
350:Senate Committee on the Judiciary 1960
229:healthcare reform in the United States
190:South-Eastern Underwriters Association
7:
805:The University of Chicago Law Review
533:
212:allows states to regulate insurance
848:Brostoff, Steven (March 5, 1990).
675:Nancy Pelosi (February 24, 2010).
650:Melissa Lipman (January 5, 2017).
56:The Act was sponsored by Senators
14:
794:Text of the McCarran–Ferguson Act
627:Buckley, Bob (October 28, 2009).
546:Brook, Herbert C. (Autumn 1950).
447:Donovan, James B. (Autumn 1950).
754:
740:
726:
279:Weller, Charles D. (May 1978).
379:Rose, Michael D. (Fall 1967).
1:
554:Law and Contemporary Problems
455:Law and Contemporary Problems
883:79th United States Congress
426:, 155 U.S. 648, 655 (1895).
924:
333:86th Congress, 1st Session
150:South-Eastern Underwriters
369:, 8 Wall 163, 183 (1868).
29:United States federal law
16:United States federal law
840:American Bar Association
316:– via HeinOnlinie.
202:denied any such intent.
168:of the Commerce Clause.
583:– via HeinOnline.
484:– via HeinOnline.
401:– via HeinOnline.
200:Attorney General Biddle
560:(4): 606–630, at 606.
387:Ohio State Law Journal
293:(2): 587–644, at 590.
893:Insurance legislation
799:Koch, Steven (1981).
605:322 U.S. at 595 n.18.
21:McCarran–Ferguson Act
878:1945 in American law
777:on November 25, 2005
734:United States portal
639:on October 31, 2009.
490:Louisiana Law Review
424:Hooper v. California
393:(4): 669–734, at 683
856:on November 2, 2012
515:322 U.S. at 584–95.
506:322 U.S. at 562–84.
180:Legislative history
174:Justice Frankfurter
165:Chief Justice Stone
27:§§ 1011-1015, is a
596:, pp. 589–90.
51:U.S. Constitution
915:
864:
862:
861:
843:
837:
828:
785:
783:
782:
764:
759:
758:
750:
745:
744:
736:
731:
730:
729:
714:
713:
706:www.justice.gov/
698:
692:
691:
689:
688:
679:. Archived from
672:
666:
665:
663:
662:
647:
641:
640:
635:. Archived from
624:
618:
612:
606:
603:
597:
591:
585:
584:
582:
580:
551:
543:
537:
531:
525:
524:322 U.S. at 584.
522:
516:
513:
507:
504:
498:
497:
485:
483:
481:
452:
444:
438:
433:
427:
421:
415:
409:
403:
402:
400:
398:
384:
376:
370:
367:Paul v. Virginia
364:
353:
347:
341:
340:
324:
318:
317:
315:
313:
287:Duke Law Journal
284:
276:
267:
266:
248:
923:
922:
918:
917:
916:
914:
913:
912:
868:
867:
859:
857:
847:
835:
831:
817:10.2307/1599333
798:
780:
778:
769:
760:
753:
748:Politics portal
746:
739:
732:
727:
725:
722:
717:
700:
699:
695:
686:
684:
674:
673:
669:
660:
658:
649:
648:
644:
626:
625:
621:
613:
609:
604:
600:
592:
588:
578:
576:
566:10.2307/1189890
545:
544:
540:
532:
528:
523:
519:
514:
510:
505:
501:
487:
479:
477:
467:10.2307/1189882
446:
445:
441:
434:
430:
422:
418:
410:
406:
396:
394:
378:
377:
373:
365:
356:
352:, p. 4841.
348:
344:
326:
325:
321:
311:
309:
299:10.2307/1372240
278:
277:
270:
263:
250:
249:
245:
241:
225:
182:
170:Justice Jackson
127:
118:Commerce Clause
110:
86:
47:Commerce Clause
17:
12:
11:
5:
921:
919:
911:
910:
905:
900:
895:
890:
885:
880:
870:
869:
866:
865:
845:
829:
811:(3): 730–757.
796:
791:
786:
766:
765:
751:
737:
721:
720:External links
718:
716:
715:
712:on 2022-09-06.
693:
667:
656:www.law360.com
642:
619:
617:, p. 476.
607:
598:
586:
538:
536:, p. 589.
526:
517:
508:
499:
461:(4): 473–492.
439:
428:
416:
404:
371:
354:
342:
319:
268:
261:
242:
240:
237:
224:
221:
220:
219:
216:
213:
210:
181:
178:
126:
123:
109:
106:
85:
82:
70:Homer Ferguson
15:
13:
10:
9:
6:
4:
3:
2:
920:
909:
906:
904:
901:
899:
896:
894:
891:
889:
886:
884:
881:
879:
876:
875:
873:
855:
851:
846:
842:. April 2006.
841:
834:
830:
826:
822:
818:
814:
810:
806:
802:
797:
795:
792:
790:
787:
776:
772:
768:
767:
763:
757:
752:
749:
743:
738:
735:
724:
719:
711:
707:
703:
697:
694:
683:on 2017-03-15
682:
678:
671:
668:
657:
653:
646:
643:
638:
634:
630:
623:
620:
616:
611:
608:
602:
599:
595:
590:
587:
575:
571:
567:
563:
559:
555:
550:
542:
539:
535:
530:
527:
521:
518:
512:
509:
503:
500:
495:
491:
476:
472:
468:
464:
460:
456:
451:
443:
440:
437:
432:
429:
425:
420:
417:
413:
408:
405:
392:
388:
383:
375:
372:
368:
363:
361:
359:
355:
351:
346:
343:
338:
334:
330:
323:
320:
308:
304:
300:
296:
292:
288:
283:
275:
273:
269:
264:
262:9780787663742
258:
254:
247:
244:
238:
236:
233:
230:
222:
217:
214:
211:
208:
207:
206:
203:
201:
196:
195:amicus curiae
191:
187:
179:
177:
175:
171:
166:
161:
159:
155:
151:
147:
141:
138:
133:
124:
122:
119:
114:
107:
105:
103:
99:
95:
90:
83:
81:
79:
75:
71:
67:
63:
59:
54:
52:
48:
44:
43:
38:
37:Supreme Court
34:
30:
26:
22:
858:. Retrieved
854:the original
839:
808:
804:
779:. Retrieved
775:the original
710:the original
705:
696:
685:. Retrieved
681:the original
670:
659:. Retrieved
655:
645:
637:the original
633:The Examiner
632:
622:
615:Donovan 1950
610:
601:
589:
577:. Retrieved
557:
553:
541:
529:
520:
511:
502:
493:
489:
478:. Retrieved
458:
454:
442:
435:
431:
423:
419:
411:
407:
395:. Retrieved
390:
386:
374:
366:
345:
336:
332:
322:
310:. Retrieved
290:
286:
252:
246:
234:
226:
204:
189:
185:
183:
162:
153:
149:
145:
142:
128:
115:
111:
102:intimidation
91:
89:insurance."
87:
58:Pat McCarran
55:
40:
20:
18:
594:Weller 1978
132:Sherman Act
872:Categories
860:2009-10-28
781:2006-03-04
762:Law portal
687:2017-03-13
661:2017-03-13
184:Since the
158:Hugo Black
579:March 25,
534:Rose 1967
480:March 24,
397:March 25,
312:March 25,
39:ruled in
33:antitrust
496:(1): 24.
137:demurrer
98:coercion
84:Overview
825:1599333
574:1189890
475:1189882
339:: 4840.
307:1372240
125:History
94:boycott
49:in the
823:
572:
473:
305:
259:
100:, and
68:) and
25:U.S.C.
836:(PDF)
821:JSTOR
570:JSTOR
471:JSTOR
303:JSTOR
239:Notes
78:Mich.
23:, 15
581:2017
482:2017
399:2017
314:2017
291:1978
257:ISBN
186:Paul
146:i.e.
66:Nev.
19:The
813:doi
562:doi
463:doi
295:doi
80:).
874::
838:.
819:.
809:48
807:.
803:.
704:.
654:.
631:.
568:.
558:15
556:.
552:.
492:.
486:;
469:.
459:15
457:.
453:.
391:28
389:.
385:.
357:^
335:.
331:.
301:.
289:.
285:.
271:^
96:,
863:.
827:.
815::
784:.
690:.
664:.
564::
494:6
465::
337:8
297::
265:.
76:-
74:R
72:(
64:-
62:D
60:(
Text is available under the Creative Commons Attribution-ShareAlike License. Additional terms may apply.