Regulatory modernization, market conduct and examinations, and credit scoring will be the top issues at the National Association of Insurance Commissioners (NAIC) Spring Meeting (March 16 -19) in Reno, according to insurers.
“Regulatory modernization of rates and forms remains our number one issue,” Don Cleasby, National Association of Independent Insurers (NAII) assistant vice president and assistant general counsel, said. “The full NAIC is expected to adopt its commercial lines modernization model at the Reno meeting and will also probably discuss information gathered at interim meetings on personal lines regulatory modernization. Testimony given at the interim meetings on personal lines supports personal lines regulatory modernization because of the benefits for consumers.”
On state-based system improvements, the NAIC has created a goal that would require insurance departments to review rate and form filings within 60-day timeframe.
“The NAIC will also ask state insurance departments to review their own requirements and work to eliminate unnecessary standards,” Cleasby explained. “By the end of the year the NAIC wants to determine how many states have been able to review and standardize checklists to see if there has been any real progress in the uniformity aspect of this issue.”
Regarding other issues, NAII said it also expects that market conduct will be a focal point at this NAIC meeting.
“The Market Conduct Analysis Working Group will be looking at protocols or guidelines that help insurance departments better target companies that need examination attention,” Cleasby said. “NAII will carefully review these protocols to be sure that they will further the goal of targeting specific companies, rather than creating a process that could be more obstructive.”
On self-audit, NAII generally supports the NAIC’s creation of principles for self-critical analysis and offered some comments to the Working Group. Cleasby expects that the NAIC will adopt the principles at the Reno meeting.
On the financial side, NAII and the other industry groups will present proposals to the Examination White Paper Focus Group on ways to make the financial examination system more efficient and less costly. These recommendations were the result of an industry survey. The survey results were presented to the focus group at an interim meeting in February No action is expected until later this spring, according to NAII.
Credit Scoring and the question of whether the NAIC should do another study on its impact on consumers will also be addressed at this NAIC Meeting.
“The bell has already sounded on this issue with 26 states now facing legislative or regulatory action on credit scoring,” Cleasby added. “The NAIC did a white paper on credit scoring several years ago acknowledging its use as one of a set of criteria in underwriting and rating. It is unclear what path the NAIC will go to at this juncture on this issue.”
Topics Legislation
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