The National Conference of Insurance Legislators may revamp a major legislative proposal that is just 2 years old.

NCOIL, Troy, N.Y., is starting to review comments about the idea of replacing the current Market Conduct Surveillance Model Act.

NCOIL and the National Association of Insurance Commissioners, Kansas City, Mo., approved the model in 2004.

NCOIL made a number of compromises to win NAIC support for the model, to present a united front to state legislatures and members of Congress.

But no states have approved the joint model. NCOIL is preparing to review the model at its upcoming summer meeting in Boston.

Some state lawmakers want NCOIL to go back to the drawing board and approve a model closer to NCOIL’s original vision.

Linda Lanam of the American Council of Life Insurers, Washington, says one aim of any new model should be to preserve the existing rights of insurers to assert the protections of any applicable statutory or common law privilege.

“In an increasingly litigious world, the potential for information to be used for purposes other than that for which it was intended cannot be ignored,” Lanam writes. “Insurers should not be penalized for seeking to assure that they are not inadvertently waiving a privilege that may be essential to them in another forum.”

Marsha Harrison, regulatory affairs counsel for the National Association of Mutual Insurance Companies, Indianapolis, says the original NCOIL draft incorporated the concept of domestic deference, or the idea that the domiciliary regulator should maintain primary authority.

Drafters took out that language to win NAIC support for the proposal.

Insurers want to see NCOIL use domestic deference to reduce redundancy and duplication in market regulation, Harrison writes.