Insurance regulation in a nutshell

Section I.3.Development of State Insurance Law

State regulation of insurance came into its own in the late 1800s. The New York Superintendent of Insurance was first created in 1859,² and the first comprehensive insurance law was enacted in New York in 1892.³ The New York insurance law was substantially revised in 1906 (following the issuance of the Armstrong Committee Report)⁴ and was recodified in 1939.⁵

Section I.4.U.S. v. South-Eastern Underwriters Ass’n (1945)

In 1945, the United States Supreme Court overruled the doctrine of Paul v. Virginia and held that the federal antitrust laws applied to an association of underwriters which was indicted and charged with conspiracy to restrain and monopolize commerce in fire insurance. In U.S. v. South-Eastern Underwriters Ass’n,⁶ the Supreme Court held that (i) the Sherman Anti-Trust Act applied to the interstate insurance business, and (ii) fire insurance transactions which stretched across state lines constitute “commerce among the several states” as to make them subject to regulation by the U.S. Congress under the Commerce Clause of the U.S. Constitution.
This ruling threatened the very viability of state regulation of insurance. Because of this, the U.S. Congress acted quickly and, by act of Congress, placed the regulation of insurance back into the hands of the states.

Section I.5.McCarran-Ferguson Act (1945)

In 1945, the U.S. Congress passed the McCarran-Ferguson Insurance Regulation Act, the purpose of which was to assure that primary responsibility for insurance regulation would remain with the states.⁷
Codified as 15 U.S.C. §§ 1011-1015, the McCarran-Ferguson Act (15 U.S.C. §§ 1011-1012) provides as follows:
Section 1011. Declaration of policy. Congress hereby declares that the continued regulation and taxation by the several States of the business of insurance is in the public interest, and that silence on the part of the Congress shall not be construed to impose any barrier to the regulation or taxation of such business by the several States.
Section 1012. Regulation by State law; Federal law relating specifically to insurance; applicability of certain Federal laws after June 30, 1948.
(a) State regulation. The business of insurance, and every person engaged therein, shall be subject to the laws of the several States which relate to the regulation or taxation of such business.
(b) Federal regulation. No Act of Congress shall be construed to invalidate, impair, or supersede any law enacted by any State for the purpose of regulating the business of insurance, or which imposes a fee or tax upon such business, unless such Act specifically relates to the business of insurance: Provided, That after June 30, 1948, the Act of July 2, 1890, as amended, known as the Sherman Act, and the Act of October 15, 1914, as amended, known as the Clayton Act, and the Act of September 26, 1914, known as the Federal Trade Commission Act, as amended (15 U.S.C. 41 et seq.), shall be applicable to the business of insurance to the extent that such business is not regulated by State Law.
The McCarran–Ferguson Act was upheld as constitutional by the U.S. Supreme Court in 1946.⁸