Regulator's meeting raises questions

State insurance official to attend invitation-only industry gathering

May 22, 2004|By David Nitkin | David Nitkin,SUN STAFF

Maryland's top insurance regulator has called an invitation-only meeting to hear concerns of selected industry executives, raising questions of access and influence from some critics.

Insurance Commissioner Alfred W. Redmer Jr., a former Republican delegate and an appointee of Gov. Robert L. Ehrlich Jr., scheduled the meeting for Monday in the Baltimore offices of Funk & Bolton, a prominent law firm specializing in insurance clients.

A year ago, Funk & Bolton lawyers were forced to cancel a $2,000-a-head insurance industry fund-raiser for Ehrlich, with Redmer as the featured guest, over inquiries about the propriety of an appearance by the then-newly installed regulator.

FOR THE RECORD - Articles in the May 22 and May 25 editions of The Sun on an insurance industry meeting called by state insurance commissioner Alfred W. Redmer Jr. incorrectly reported the sponsorship of a 2003 campaign fund-raiser for Gov. Robert L. Ehrlich Jr., and the May 22 article contained incorrect information on the lobbying activities of a law firm. A fund-raising event scheduled for June 2003 but later canceled was organized by David M. Funk as an individual, not the firm Funk & Bolton. Additionally, while Funk & Bolton attorneys have represented CareFirst BlueCross BlueShield, and the health insurance company opposed regulatory legislation passed during the 2003 General Assembly session, firm attorneys did not lobby the governor to veto the bill. The Sun regrets the error.

Redmer said yesterday that he called for the meeting to hear opinions from industry leaders but did not select the invitees. Insurance associations determined the guest list, he said. Redmer said he plans to attend alone, without staff.

Distribution of the invitations appears to be selective. "I haven't been invited or informed about the meeting," said W. Minor Carter, a lobbyist for the Maryland Association of Mutual Insurers. "My clients are very disappointed they are not included in a meeting discussing the property casualty insurance industry, because that is all they write."

The closed nature of the session is troubling to some lawmakers and other observers.

Redmer "has a legitimate right and responsibility to find out what the barriers and strengths are" in Maryland's insurance markets, said Sen. Thomas M. Middleton, chairman of the Senate Finance Committee, which oversees insurance issues.

But "if you have a company like Funk & Bolton promoting this, it is bound to raise suspicions," Middleton added. "If this thing is closed off to the public, and it is invitation-only and open to only groups who have to been friendly to the governor, then it is a cause for some concern and suspicion."

"It is a way for the firm to do some easy marketing by holding out easy access to the commissioner, and it is a way for Redmer to meet with the industry he represents," said Steven B. Larsen, the former head of the Maryland Insurance Administration who was succeeded by Redmer. "With all due deference to all the parties, it is not unusual for law firms and lobbyists to sell themselves as having access to people in government."

Last year's fund-raising flap, in which Funk & Bolton organized an event as it was lobbying the governor to veto legislation concerning health insurance giant CareFirst BlueCross BlueShield, "is still fresh in a lot of people's memories, including mine," Middleton said.

Redmer said Monday's meeting is one of a series that he intends to hold in the coming weeks to gather information on regulations and competition. Other sessions, he said, will include "town hall" style meetings to which the public will be invited.

"I know what my interests are. But I don't want there to be any burning issue out there that I should know about that has fallen through the cracks," Redmer said. "Monday is a small part of the process of trying to prioritize how to spend our time over the next three or four months, as we end one legislative session and prepare for the next."

But James Browning, executive director of Common Cause Maryland, which tracks the role of money in politics, said the gathering sounded exclusionary.

"That's some of the biggest donors and lobbyists holing up in a room to decide the future of everything under Mr. Redmer's responsibility," Browning said. "It's subcontracting part of his job and letting Funk & Bolton decide who the players are. Hopefully, the public will get a chance. But to start off this way, with a very elite group, what kind of message does that send?"

While the meeting has not been publicized, Redmer said yesterday that "it really doesn't matter to me one way or the other" if media members attend. If they do, he cautioned, comments from business leaders could be "less than frank."

Bryson F. Popham, a Funk & Bolton attorney and lobbyist, said yesterday that Redmer suggested the meeting. "We are just hosting it because it is a convenient place to have it," he said. Invitations, he said, were not distributed by Funk & Bolton, but by the American Insurance Association, which is represented by firm attorney John A. Andryszak; and the Property Casualty Insurers Association of America.

"Certainly we have changes we would like to see in the insurance code, and he has things on his plate that he wants to talk about," Popham said. "Some of the things he has to propose we may like; some we may not like."

After questions from a reporter, Popham telephoned one of the groups that had not received an invitation and told them they could attend. "Nobody was excluded," he said later.

Redmer called the meeting part of an outreach effort to learn areas where the state's insurance market could be made more competitive. He said he will meet in June with representatives of brokers and agents and will schedule the town hall meetings after that.

"The public will be a part of the process," he said. "I meet with the public all the time."

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