State insurance commissioners adopted by a 31-20 vote a market conduct model law designed to streamline the market conduct process, despite reservations voiced by a number of regulators.
The vote on the National Association of Insurance Commissioners version of a Market Conduct Surveillance Model Act was taken during the fall NAIC meeting here.
The model seeks to establish uniform procedures based on a concept of market analysis and targeted examinations. Among other points, it defines the scope of market conduct examinations and authorizes the acceptance of market conduct examinations by states that have enacted similar laws based on a domestic deference approach.
It was first adopted by the National Conference of Insurance Legislators, Albany, N.Y., in February 2004. The NAIC membership then decided to make changes to the model to allay concerns among regulators that the model would tie their hands in performing market conduct work.
NCOIL had taken the position that if the revised version of the model was not adopted at the fall NAIC meeting, that it would have gone off on its own and adopted its original model.
Many of the elements in the model are incorporated in a new SMART draft proposal released on Aug. 19 by Reps. Mike Oxley, R-Ohio, and Richard Baker, R-La. Streamlining the market conduct process is one area that is considered a way to illustrate the effectiveness of state insurance regulation.