The Financial Condition Committee at the National Association of Insurance Commissioners has unveiled a preliminary version of a proposed U.S. Insurance Solvency Framework.
The committee, the coordinator of solvency-related efforts at the NAIC, Kansas City, Mo., has posted a draft of the framework on its section of the NAIC’s website.
The NAIC launched a Solvency Modernization Initiative in June 2008.
“The purpose of this paper is to describe the framework of the U.S. Insurance Financial Solvency System and present a set of core financial principles underlying this framework,” the framework drafters write in a description of their objectives.
The framework draws on ideas developed by the International Association of Insurance Supervisors, Basel, Switzerland, but it “goes beyond the IAIS in important, material ways,” the drafters write.
“In particular, in the U.S. regulatory system, ongoing collaborative regulatory peer review, regulatory checks and balances, and risk-focused financial surveillance form the foundation of the regulatory process,” the drafters write.
The framework explains that, in the United States, the U.S. insurance financial solvency core principles are expressed in the NAIC’s Financial Regulation Standards and Accreditation Program, the drafters write.