Insurance regulators have denied a request from the life insurance industry to relax capital and surplus requirements. The National Association of Insurance Commissioners reached the decision yesterday during a meeting after spending three months weighing the proposal.
“So far the insurance industry is in much better condition than most of the rest of the financial services sector because of strong state solvency regulations,” said NAIC President and New Hampshire Insurance Commissioner Roger Sevigny. “Simply put, the industry has not made a credible case for why we need to make changes on an emergency basis, and why those changes should be limited to the specific proposals made by the industry.”
According to a statement released by the NAIC, during a four-hour public hearing held Jan. 27, regulators took comments from industry representatives, consumer groups and other interested parties on the industry’s nine proposals.
Following the hearing, members of the NAIC Capital and Surplus Working Group recommended the rejection of three proposals, and the approval of variations of six other proposals impacting reserving requirements, reinsurance collateral and accounting procedures.