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Faculty Scholarship at Penn Law

Insurance

Antitrust and Trade Regulation

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Articles 1 - 2 of 2

Full-Text Articles in Law

The Insurance Industry's Antitrust Immunity, Herbert J. Hovenkamp Jan 2010

The Insurance Industry's Antitrust Immunity, Herbert J. Hovenkamp

Faculty Scholarship at Penn Law

The 1945 McCarran-Ferguson Act provides that federal legislation generally, including the antitrust laws, is “applicable to the business of insurance [only] to the extent that such business is not regulated by State law.” The statute was enacted after United States v. South Eastern Underwriters Assn. (1944), held that insurance transactions were “interstate commerce” and thus subject to the antitrust laws. That case had in turn undermined the traditional view expressed in Paul v. Virginia (1868), that insurance was not interstate commerce, but strictly local transactions. The South Eastern case followed in turn upon the Supreme Court's decision in Wickard ...


Federalism And Antitrust Reform, Herbert J. Hovenkamp Oct 2005

Federalism And Antitrust Reform, Herbert J. Hovenkamp

Faculty Scholarship at Penn Law

Currently the Antitrust Modernization Commission is considering numerous proposals for adjusting the relationship between federal antitrust authority and state regulation. This essay examines two areas that have produced a significant amount of state-federal conflict: state regulation of insurance and the state action immunity for general state regulation. It argues that no principle of efficiency, regulatory theory, or federalism justifies the McCarran-Ferguson Act, which creates an antitrust immunity for state regulation of insurance. What few benefits the Act confers could be fully realized by an appropriate interpretation of the state action doctrine. Second, the current formulation of the antitrust state action ...