Sandy Praeger, president of the National Association of Insurance Commissioners (NAIC) and Kansas insurance commissioner, is critical of Treasury’s plans for overhaul of the insurance industry. “We think insurance regulation, from a consumer protection standpoint, works,” she says, pointing toward Medicare private insurance plans as an example of what happens when insurance commissioners are not allowed to regulate a product within the industry.
The new regulations, she says, are “hollow promises,” because commissioners will not be allowed to do what they’re doing now — for instance, providing financial surveillance, Praeger points out, to ensure companies actually can pay on policies. “That kind of oversight just isn’t going to occur in a federal office,” she declares. “Why would you want to recreate the 13,000 state employees that do this job day in and day out?” she asks, questioning the wisdom of “recreat[ing] that bureaucracy at the Federal level.”
Conceding that there is modernization work to be done, Praeger points to many actions already underway or successfully in use by NAIC. Numerous issues mentioned in the Blueprint are already being addressed, she adds. The system for electronic rate and form filing, or SERF, is gaining more users; the national producer registry is being improved to the tune of several million dollars; and interstate compacts for solvency standards are already in place.