Members of the National Conference of Insurance Legislators might seek 4% of the state fee revenue now going to the National Association of Insurance Commissioners.

The proposal will come up for discussion this week, at a 5-day NCOIL annual meeting that will start Wednesday in Las Vegas.

States now pay the NAIC, Kansas City, Mo., assessments linked to insurance premium volume.

NCOIL’s Insurance Legislators Foundation board has included the state fee sharing proposal in the second phase of a report on state insurance regulation.

NCOIL members discussed the first phase of the draft report this summer.

The ILF board and NCOIL’s executive committee will review the second phase of the draft, which includes the fee sharing proposal, Friday in Las Vegas.

NAIC officials had no immediate comment on the proposal.

The authors of the ILF draft report contend that the NAIC is collecting more revenue than it needs.

The total amount of NAIC state fee revenue will increase to about $2.1 million in 2008, from $1.9 million in 2005, and the NAIC’s surplus of assets over liabilities is on track to increase to $57 million in 2008, from $54 million in 2005, the ILF says.

Because the NAIC has more revenue than it needs and NCOIL has less, NCOIL will urge member lawmakers to earmark some insurance department funding for NCOIL rather than for the NAIC, according to the text of the proposed resolution.

In another part of the second phase of the ILF report draft, the authors call for strengthening insurance commissioners’ authority, especially in states that have combined financial services regulation operations, says NCOIL Executive Director Susan Nolan.

If the authority of commissioners expands, state legislators will need more resources to oversee the commissioners’ activities, Nolan says.

The draft authors also make the following recommendations in the second phase:

- Increase NCOIL funding resources and membership.

- Open all NAIC meeting sessions.

- Consider strengthening state insurance regulation through expansion of the Interstate Insurance Product Regulation Compact.

- Support an independent commission of stakeholders in considering how state insurance regulation can be further strengthened.