NCOIL May Act On Market Conduct, Life Settlements Models
Action on market conduct and life settlement model acts and a resolution on the need for an extension to the Terrorism Risk Insurance Act of 2002 are part of the agenda for a meeting of state insurance legislators in Chicago that started last Friday.
Other issues to be examined during the summer meeting of the National Conference of Insurance Legislators, Albany, N.Y., include a discussion on corporate governance.
The American Council of Life Insurers, Washington, says it will present information on investor-owned life contracts and the potential negative effect they could have on the industry. Insurers have raised concern over the growing use of a product called life insurance and life annuity contracts (LILACs) and the potential whittling away of the concept of insurable interest.
Two models that could receive the full support of NCOIL are the Market Conduct Model Surveillance Model Act and the Life Settlements Model Act.
Discussion of changes to the market conduct model involves several substantive points and technical wording issues. Among the concerns to be discussed are whether a cost estimate or actual budget must be given to a company when it is going to be examined; whether a company should be allowed an administrative or an informational hearing if it disagrees with the findings of an examination; and, how the concept of accepting the market conduct exam results of another state should be put into effect.
Trades that are expected to weigh in on the model include the American Insurance Association, the ACLI, the National Association of Mutual Insurance Companies, and the Property Casualty Insurers Association of America. Birny Birnbaum, executive director of the Center for Economic Justice, also is offering suggestions so the model can advance with broad support.