Public Policy Analysis & Opinion

Farewell, Jim Long

Long-time insurance commissioner and former NAIC chairman
was a colorful and effective regulator

By Kevin P. Hennosy

On February 2, 2009, state insurance regulation lost a lion when former North Carolina Insurance Commissioner Jim Long died. Long, who had served as North Carolina Insurance Commissioner for 24 years, did not seek re-election in 2008 and retired from office on January 9, shortly before his death. Jim Long was 68 years old in human years, but he packed a lot of life into that limited time period.

With Jim Long’s passing, my family lost a friend. I lost a trusted source. He was a foil for ideas and an active collaborator in evening activities that made attendance at National Association of Insurance Commissioners (NAIC) survivable. Furthermore, state insurance regulation lost a creative leader who had the political smarts to get things done.

More than any other person I have known who claimed the title of insurance regulator, Jim Long lived up to a standard enunciated by Murray Danforth Lincoln, the founder of Nationwide Insurance, who said that every organization needed a “Vice President In Charge of Revolution.” Danforth described this role as:

“somebody on the staff who’d spend full time keeping everybody and everything stirred up; somebody who knew when to nag and when to inspire and who could do both equally well; a kind of professional ‘needler’ who, by timely reminders of the organization’s fundamental objectives, would keep leadership on its toes and on the right track.”

Through understanding, hard work, dedication and force of will, Jim Long became a national force in insurance regulation. He was no angel. He had quirks. Yet, Jim Long left insurance regulation better than he found it. He stayed focused on the public interest and fair markets, and that was not always popular with the NAIC leadership or insurance carrier trade groups.

It is difficult to imagine the restoration of the state regulatory system without Jim Long. He understood the nuts and bolts of how regulation worked. Jim Long loved politics and understood how to use it to get practical things done. He was no ideologue, which aggravated extremists on both the political left and right. There are consumer advocates and insurance lobbyists who could agree on little else than the fact that they hated Jim Long’s guts. That alone should be a favorable measure of the man.

Politics was in his genetic make-up. His grandfather Long served in the North Carolina House of Representatives and so did his father, George Long, who was something of a prodigy who entered the University of North Carolina at 15 and graduated Phi Beta Kappa. George Long finished law school so early that he had to wait to take the bar exam until he reached the age of 21.

Jim learned a great deal about politics from his father, including the use of a simple fashion statement. The elder Long adopted the red tie as his signature clothing item and Jim Long continued the tradition. When I first heard of Commissioner Long in 1987, I learned of his propensity for wearing red ties. The political book on Long included a warning that the insurance commissioner did not take kindly to men who tried to dilute the recognition value of his red ties by wearing one as well. I heard stories of Commissioner Long confronting attendees to events who wore red ties and insisting that they remove their neckwear. Other versions of the story limited the “second red tie in the room prohibition” to members of insurance department staff.

Long was not the Ken doll-type of politician whose decisions and behavior were driven by a political consultant. Politics was a personal pursuit and sometimes a contact sport in Jim Long’s world. He understood the legislative use of carrots, sticks, pyrotechnics, blue smoke and mirrors. He was Old School, in the way that Lyndon Johnson and Sam Rayburn ran congressional business. In the evenings, political competitors could adjourn to trade stories in hide-a-ways where adult beverages and smoking materials could be consumed with gusto. Yes, the latter probably shortened his life, but his life and the lives of those who shared it were richer for those hide-a-way meetings.

Long could be tough when it was necessary. When he was sworn into the office of insurance commissioner in 1985, he immediately fired 11 employees. When the rest of the department staff was assembled in a conference room, many feared that he would fire everyone and bring in an army of political hacks. The new commissioner made it clear that there would be changes in the way the department ran, but he calmed the fears of career employees when he admitted he respected and needed their expertise.

I first met Jim Long in the lobby bar of the Hilton Hotel in Santa Fe, New Mexico. A year later I was hired by the NAIC to run the association’s press office (consisting of me) and to write The NAIC News, a monthly newsletter that recycled the association’s “news” releases.

Long was planning to make a run for the leadership of NAIC, but he was not a popular choice. Appointed insurance commissioners disdained him as a headline hound. (As a rule of thumb, elected insurance commissioners will court news coverage, and appointed insurance commissioners try to keep their names out of the paper.) The insurance carrier trade associations did not trust Jim Long because he tended to take companies to task over rate increases. Agent associations generally liked Jim Long and encouraged his candidacy.

In September 1988, the NAIC met in Wilmington, Delaware. The convention is remembered for the gratuitous expenditures for insurance commissioners by then-Delaware Insurance Commissioner David Levinson, who was running for NAIC vice president. There was never a full accounting of the money spent on entertainment at that meeting, or from where the money actually came. The opening reception featured model trains carrying caviar, and champagne fountains on heavily laden appetizer tables decorated with real Fabergé eggs. Levinson also rented a country estate, hired a symphony orchestra and transported all the commissioners to a party in individual chauffeured limousines.

Jim Long countered this campaign expenditure by bringing a purveyor of the finest North Carolina barbeque for a pulled pork feast. The event was kind of lost in the glitz, but in the long term that worked to Long’s advantage.

Three months later, Commissioner Long beat Commissioner Levinson in the election for NAIC vice president, which made his ascendance to NAIC president all but certain. It was not a pro-Long vote. The NAIC membership and the company lobbyists who advised the commissioners did not trust Long, but they hated Levinson.

I am sure Jim knew the source of his electoral victory. He was left off invitation lists. He was not trusted by other NAIC leaders. I can remember an e-mail on which he was absent mindedly copied. An NAIC leader made some particularly cruel comments about his Southern Country Style.

But Jim had more guts than most of the commissioners he served with at a time when Congress was demanding reform from the states. When Earl Pomeroy, now a congressman, was North Dakota Insurance Commissioner, he proposed a series of reforms, which he named the “Solvency Policing Agenda.” The reform program would not have been as successful as it was without Jim Long’s ability to shape legislation, form coalitions and horse trade.

One impediment to the insurance reform that Pomeroy, Long and others sought was the fact that the ranks of insurance commissioners were infested with more than their share of crooks. One such bandit was then-Louisiana Insurance Commissioner Doug Green, who was ultimately prosecuted on federal and state corruption charges. In June 1990, indictments against Green came down while he was attending an NAIC National Meeting in Baltimore.

The NAIC was taking a beating over Green who was a poster child for bad behavior; still most of the leadership was not willing to separate the commissioner from the association. After a reporter informed me of the indictments, the leadership convened a meeting to discuss how to encourage Doug Green to leave. His staff was actually telling the NAIC that he would not even physically leave the hotel because he needed a place to hide from reporters.

In that meeting, I remember after several passive/aggressive options were discussed, Jim Long picked up the phone and called Doug Green’s room. A staff member or family member answered and insisted that the NAIC should hide Green. Commissioner Long informed them that Green had 15 minutes to leave because after that he was sending “Kevin Hennosy to the room with all the reporters and TV crews who want interview Doug.” Commissioner Green vacated the hotel.

Commissioner Long made his share of stumbles, such as introducing several North Carolina insurance agents as his lieutenants when he was elected NAIC president 1991. The trade press chided him for it because Congress was pummeling the NAIC for being too close to industry. More critically, he was investigated by federal prosecutors once in the early-1990s, but no charges were ever filed.

Long’s real troubles came from forces at the NAIC that opposed efficient and effective insurance regulation. His insistence upon protecting and expanding an agenda of regulatory reform at the NAIC earned him some enemies. As NAIC president, he proposed a second round of Solvency Policing Agenda reforms. He saw the majority of those reforms enacted and implemented.

However, in the mid-1990s, there was a political backlash from property/casualty insurers facilitated by new leadership in Congress, which sought to deregulate the financial sector. Long spent much of the last 15 years trying to protect from reactionary harm the improvements his reform-oriented cohorts had made to insurance regulation.

That activity put him in direct confrontation with carrier trade associations and former NAIC Executive Vice President Catherine J. Weatherford. Long was able to stay influential because he was a former NAIC president, and on numerous occasions that made him the “immediate past president” as commissioners left for industry jobs. As immediate past president he was a member of the NAIC governing board (the Executive Committee), which allowed him to monitor Weatherford’s plans to make NAIC a more profit-driven and less-regulatory organization.

I worked with Commissioner Long for many years trying to battle those plans. As a member of the Executive Committee he received regular briefings on the association’s finances and business plans, which he would often leak to me.

For many years I received the same briefing booklet as NAIC Executive Committee members, which Commissioner Long would leave for me under false names at hotel front desks. I also received copies of quarterly reports on what companies were withholding how much money from the NAIC in financial statement filing fees, as an act of boycott aimed at forcing weaker regulation. I would write about these documents and distri­bute them to other journalists.

Perhaps Jim Long’s finest hour was when he stood up to a plan hatched by Cathy Weatherford and a weak band of NAIC-elected leaders aimed at ending the fee boycott. Held in the Chicago suburbs on May 22, 1996, the dinner resulted in a quid pro quo agreement in which the NAIC leadership agreed to focus on solvency regulation at the expense of consumer protection, in return for money, i.e., ending the filing fee boycott. The deal ran counter to the basic tenets of the McCarran-Ferguson Act.

At a June 1997 meeting of the NAIC, Jim Long delivered an eloquent defense of strong and effective state insurance regulation when the vote was taken. He lost the vote. Weatherford got her agreement and her money from the boycotting insurers.

Yet Commissioner Long made the point publicly that the “Nick’s Fish Market Agreement,” named after the restaurant where the May meeting was held, would weaken regulatory oversight in return for money. The commissioner procured and provided to me an audiotape of the proceedings, which I later provided to the Wall Street Journal, which in turn reported on the quid pro quo arrangement on February 5, 1998.

Jim never forgave Catherine Weatherford for what she did to the NAIC and for the self-aggrandizing management style she employed there. I know he was happy to see her pushed out of her job in July 2008. Last year, my wife and I received a holiday card from the commissioner, which included the observation that at least he outlasted Cathy Weatherford at the NAIC.

He is survived by his wife, Peg O’Connell, two children and five grandchildren.

Farewell Commissioner Long; you are missed.

The author
Kevin P. Hennosy is an insurance writer who began his insurance career in the regulatory compliance office of Nationwide Insurance Cos. and then served as public affairs manager for the National Association of Insurance Commissioners (NAIC). Since leaving the NAIC staff, he has written extensively on insurance regulation and testified before the NAIC as a consumer advocate.