The National Conference of Insurance Legislators should be getting the fees now paid by states to the National Association of Insurance Commissioners, according to a new study by NCOIL’s research foundation that was endorsed by the board of NCOIL during the group’s November annual meeting.
State assessments accounted for $2 million of NAIC’s $64.2 million budget in 2006, according to NAIC figures. “There needs to be more legislative involvement and oversight of the NAIC,” said NCOIL Executive Director Susan Nolan. “We have to develop the best system that we can have. But we need more funding in order to do so.”
On November 16, during a joint meeting of the Insurance Legislators Foundation (ILF) Board and Executive Committee, legislators considered Phase II of an ILF Study on State Authority: Making a Case for Proper Insurance Oversight. Phase II proposes specific recommendations to enhance and improve state insurance regulation, including:
- increasing funds for state legislators to help them assume a larger role in regulatory modernization;
- clarifying regulatory roles and enhancing insurance regulators’ authority by restoring the stature of state insurance agencies; and
- expanding legislative oversight of insurance regulation, including developing standards and best practices and establishing an insurance accountability office.
Phase II also proposes amending insurance codes to provide that state regulators may only participate in meetings pertaining to development and debate of public policy if those meetings are open to the public; strengthening state insurance regulation by expanding the interstate insurance compact; and supporting an independent commission of stakeholders to consider how state insurance regulation could be further strengthened.
The ILF—the research and educational arm of NCOIL—commissioned the study to take an in-depth objective look at insurance regulation in the states in order to make necessary improvements.
What It Means to Agents: PIA has been involved with this study from the very beginning and we fully support this undertaking. PIA’s Insurance Foundation donated $50,000 in order for this study to move forward. We are very pleased to see how NCOIL is proceeding with the study and acting on its recommendations.
Even though the study has been completed, this is just the beginning. The legislators at the NCOIL Annual Meeting vowed to keep the study alive by discussing it at every meeting for the foreseeable future; and now that the recommendations have been outlined, the legislators will evaluate and act on each one.
December 4, 2007