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NCOIL Meeting Highlights

The National Conference of Insurance Legislators (NCOIL) met in Washington, D.C. March 8-10...
March 13, 2013

The National Conference of Insurance Legislators (NCOIL) met in Washington, D.C. March 8-10. Hundreds of attendees and scores of legislators met to discuss several pressing issues including regulation of navigators, producer licensing and property/casualty insurance binders.

The NCOIL Health, Long-Term Care & Health Retirement Issues Committee, chaired by Rep. Corman (PA), passed a navigator resolution supported by PIA National. The resolution, cosponsored by Senator Carroll Leavell (NM) and Representative George Keiser (ND), recognizes the creation of navigators by the Affordable Care Act (ACA) and urges states to enact a licensing framework and regulatory regime for navigators. The resolution was opposed by several consumer groups that asserted the resolution was not necessary because “navigators will not be paid to sell, solicit, negotiate, consult or place insurance.”

PIA National supports states that would like to implement a regulatory system for navigators and we stand ready to assist any state in that effort. We believe the regulation of navigators is an important consumer protection measure.

The NCOIL Property-Casualty Insurance Committee, chaired by Representative Lehman (IN) held a special working session on their insurance binder model. The purpose of this session was to examine several amendments to the NCOIL binder model submitted by some lenders.

PIA National’s Assistant Vice President for Regulatory Affairs David Eppstein testified on behalf of PIA National. Eppstein testified that the base model adequately addressed the principle concerns of the lenders by making it clear the binder serves as adequate evidence of coverage until the policy is issued. The NCOIL binder model also provides for some basic coverage information to be included on the binder, such as a description and amount of coverage, date of coverage and information on the insured. The lenders were mainly interested in making sure that either they had the policy or the binder delivered to them in a timely manner.

Eppstein testified that insurers have every incentive to issue the policy in a timely manner because the vagueness of the binder benefits the insured. If a loss occurs during the binder period, it will likely be covered. If a loss occurs after the policy is issued, the particular peril that caused the loss may be specifically excluded in the policy. Instead of acting on the amendments, Chairman Lehman strongly urged the parties to work together towards a compromise at the Association for Cooperative Operations Research and Development (ACORD). The compromise contemplated at ACORD would essentially merge the ACORD 75 binder with the ACORD 28 certificate, creating a new binder form for use by commercial lenders called the 875. Eppstein said PIA National supports this concept and would work with the other groups involved to help finalize a satisfactory form.

NIPR in 50 States, Provides Licensing for 5.4 Million Producers. Good news on the state regulatory front: Independent insurance agents will soon be able to obtain and maintain non-resident licenses electronically through the National Insurance Producer Registry (NIPR) or one of their authorized business partners in every state and the District of Columbia. Massachusetts, the last state holdout, will be accepting these transactions later this week.

The number of producers in the NIPR database now exceeds 5.4 million. More states and jurisdictions are adding NIPR products. We recommend all states and jurisdictions utilize every applicable NIPR product in order to finally achieve our goal of true “one-stop shopping” for licensing.

There is also good news to report on the Interstate Insurance Product Regulation Commission (IIPRC). 41 states have enacted the compact into law and 4 states have pending or introduced legislation in 2013. The compact streamlines the way insurance products are filed, reviewed and approved, and it currently represents 70% of the premium volume nationwide. The IIPRC is the central point of electronic filing for asset-based insurance products, including life insurance, annuities, disability income, and long-term care insurance. PIA National supports the compact and we urge all the states that haven’t adopted it yet to do so.