Sen. Elizabeth Dole (R-N.C.), wants the Securities and Exchange Commission to require publicly-traded companies to have "financial statement insurance" for their audits as a way to restore investor confidence in corporate America. Dole made her suggestion during last week's Senate Banking Committee's confirmation hearing for William Donaldson to become the next chairman of the SEC.

Under Dole's proposal, a publicly traded company would have to purchase an auditor policy from an insurance company. The insurance company, and not the policyholder, would hire the auditor, said Dole. "The auditor would have loyalty to the [truthfulness] of its statements and not to the company being audited," she added. The insurance company could adjust the policyholder's premium depending on the accuracy of the financial statement. In other words, the more the company's financial reports are in question the higher the premium the insurance company would charge. Danaldson said he would "take a look at the idea."

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