Ending a period of much speculation among insurers and consumers representatives, regulators came of out meeting in a closed session and promised to deliver a suitability solution that everyone could sign off on.
The promise was made in the form of a charge for the Life and Annuities “A” Committee during the fall meeting of the National Association of Insurance Commissioners here. The 2003 charge to continue the suitability project is a broader mandate than the 2002 charge to develop a suitability model.
As “A” Committee Chair Merwin Stewart and Ohio Insurance Director Lee Covington explained, the broader charge will permit regulators to consider more options for a solution.
As Stewart detailed, regulators are seeking to develop a suitability solution that varies according to product. Different standards will be considered because of differences in products such as life insurance and annuities and how those products are sold.
Although the concept of suitability could conceivably be applied to property-casualty products, Covington said the issue has not been raised in this context and, consequently, at this point, need not be addressed.
Long term care products suitability is currently addressed in a NAIC long-term care model, Covington added.