Legislators, insurers and consumer advocates urged the National Association of Insurance Commissioners to advance policies of openness and transparency, during the NAIC’s winter meeting here.
A call for greater transparency over how the NAIC develops testimony for Congressional hearings was made by insurers during the industry liaison committee. The call followed a consumer liaison meeting in which NAIC funded consumer representatives recommended that commissioners pursue a policy of open meetings to ensure better participation when policy issues are being developed.
Referencing an NAIC estimate that the organization testifies before Congress between 30 and 50 times a year, and noting that it will continue to be asked to speak out on insurance issues, Deidre Manna, a representative with the Property Casualty Insurers Association of America, Des Plaines, Ill., asked whether NAIC has a process for approving positions it takes during testimony. “If there is one that is more formalized, we’d be interested in hearing about it. But if that is not what is taking place, we’d like to urge you to formalize [the process.]“
There are 3 categories of situations that give rise to concern, said Marsha Harrison, representing the National Association of Mutual Insurance Companies, Indianapolis. The first instance, she said, occurs when NAIC congressional testimony is in conflict with what working groups and committees of the NAIC are doing. A second case, Harrison said, is when a commissioner speaks as an individual, but NAIC publicity makes it appear as if the testimony represents the organization. “The fact that a person is testifying on his own is lost in the translation.”
A third situation, she added, is when a news release praises an act in Congress when the NAIC has not adopted a position. Harrison cited the Klein-Mahoney Homeowners Insurance bill on catastrophe funding.
“The threshold question is ‘What is the process and is it tracking with what NAIC working groups are doing?’ ” Dave Snyder, a representative with the American Insurance Association, Washington, stated. “ Secondly, if there is diversity [of opinion] in the regulatory community, how can that be expressed?”
Michael McRaith, Illinois insurance director and chair of the industry liaison committee, said e-mails are exchanged and there is a discussion among members so that commissioners have a chance to look at testimony. Then it is used, he said.
But Mary Jo Hudson, Ohio insurance director, disagreed using the Klein-Mahoney bill as an example. “There is a very involved process for model laws but where there are divergent views, it appears the NAIC as a whole had a position where only certain parts of the NAIC [were considered.] It was a done deal by the time it was circulated.” There were a number of times when a taken position did not reflect Ohio’s position.