Which type of government is primarily concerned with regulating insurance?

The correct answer is that the state government is primarily concerned with regulating insurance. Each state in the U.S. has its own set of laws and regulations governing insurance practices within its borders. This regulatory authority is typically assigned to a state insurance department or commission that oversees the insurance markets, ensuring that companies operate fairly and consumers are protected.

State governments handle licensing for insurance agents and companies, monitor insurance rates, and ensure compliance with state laws relevant to insurance practices. Moreover, state oversight allows for localized regulatory frameworks that can adapt to the specific needs and circumstances of the state's residents.

Federal regulation of insurance is generally limited, as the McCarran-Ferguson Act allows states to retain authority over insurance companies, thereby prioritizing state control. While there are federal laws affecting the insurance industry, such as privacy regulations or specific policy requirements, the primary regulatory authority lies with the states. Local government entities, like counties and cities, do not have the jurisdiction or resources to regulate insurance effectively, making state government the definitive authority in this area.