NAIC Sees Slower Track For
Market Conduct Model Review
Members of the National Association of Insurance Commissioners seem to be drawing back on mobilizing quick support for another groups market conduct model.
NAIC leaders had wanted to rally support for the model, which was approved Feb. 27 by the National Conference of Insurance Legislators, in time for the U.S. House Financial Services Committees March 31 hearing on federal insurance regulation.
NAIC leaders had hoped commissioners could approve a slightly modified version of the NCOIL model after making minor technical changes.
But coming up with broad support for the model by the date of the hearing is “probably unrealistic,” says Joel Ario, the NAIC secretary-treasurer and Oregon insurance administrator.
The NAIC would be better off taking the time to make sure everyone is heard and that the NAICs version of the NCOIL document receives broad support, Ario said during a meeting on the NCOIL model.
Ario did set a June deadline for efforts to get the NAIC to weigh in officially on the market conduct model.
Tim Tucker, NCOILs director of state-federal affairs, asked regulators to stick to technical rather than substantive changes.
But meeting participants said they had questions about some NCOIL model provisions.
Some of their concerns:
The commissioners do not want a statute to limit their actions before they undertake market conduct examinations or to tell them what actions they must take. A statute that tells commissioners what they can and cannot do would be inappropriate, according to Mark Presser, a New York regulator.
A market conduct statute should encourage regulators to defer to market conduct efforts in an insurers state of domicile, but states that want their market conduct efforts to be received in other states ought to meet minimum competency standards.
A market conduct statute should not turn financial statements and other documents that now are public into confidential documents.
Reproduced from National Underwriter Life & Health/Financial Services Edition, March 25, 2004. Copyright 2004 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.