Is less more? In terms of filing securities that are included in insurance company investment portfolios for regulatory overview, insurers are saying such is the case.
However, state insurance regulators at the National Association of Insurance Commissioners in Kansas City, Mo., are saying that while efficiency is an important goal, there must be procedures in place to allow regulators to check for a companys financial strength.
The issue of achieving efficiency was raised several times during the Securities Valuation Office Oversight Working Group at the recent fall NAIC meeting in New Orleans, as well as in a paper that was released by the National Association of Mutual Insurance Companies, based in Indianapolis.
The NAMIC paper advocates several changes regarding filing of securities with the SVO–an NAIC investment monitoring body that is based in New York. Those steps include:
Removing duplicative ratings activity and personnel and facilities associated with the rating of investments.
Allowing ratings of securities that are not rated by nationally recognized securities rating organizations (NRSROs) only to the extent that the SVO successfully competes with NRSROs.
Providing research to regulators on an as-needed basis rather than on an unlimited basis.
Making SVO revenues and expenses fully transparent.