Which landmark case determined that insurance was not commerce and thus not subject to federal regulation?

The case of Paul vs. Virginia is significant because it established a precedent regarding the regulation of insurance. In this 1869 Supreme Court decision, the Court ruled that insurance transactions did not constitute interstate commerce and therefore could not be regulated by the federal government. This ruling enabled states to maintain control over the insurance market within their jurisdictions, emphasizing the state's ability to regulate insurance without interference from federal laws.

This decision remained influential for many years, until it was later addressed and effectively overturned by the U.S. vs. South-Eastern Underwriters Association case in 1944, which determined that insurance does indeed engage in interstate commerce and is therefore subject to federal regulation. Understanding the historical context of Paul vs. Virginia helps clarify how state regulatory authority was upheld prior to changes prompted by later rulings. The subsequent importance of the McCarran-Ferguson Act further solidified states' rights to regulate insurance but acknowledged the role of federal oversight in certain situations.