Posted on 29 Jan 2009
The National Association of Insurance Commissioners (NAIC) Capital and Surplus Relief Working Group held a public hearing on Thursday to continue its review of requests from the life insurance industry to make adjustments in existing NAIC solvency framework components that impact statutory capital and surplus requirements.
“During these perilous times for our nation’s financial sector, insurance regulators are faced with some challenging decisions, but our foremost priority must be to protect America’s insurance consumers,” said NAIC President and New Hampshire Insurance Commissioner Roger Sevigny. “Many of the proposals before the Working Group have been discussed for years as part of our continuing efforts to modernize our solvency regime, and we are being extremely cautious as we proceed with consideration of any changes.”
More than 150 people attended today’s public hearing at the Marriott Wardman Park Hotel, where regulators received written and oral testimony from several consumer groups and industry representatives.
“Today’s hearing highlights the difficult decisions we are faced with and the divergent opinions on how we should proceed,” Sevigny added. “I am confident that we will come to a good conclusion for the nation’s insurance consumers and companies, and I look forward to continued discussion as the NAIC’s Executive Committee and Plenary consider the Working Group’s recommendations.”
Prior to making recommendations to the full NAIC membership, the Capital and Surplus Relief Working Group asked several specialized technical groups to review and comment on nine specific proposals.
“Each of these proposals was considered and scrutinized by teams of accounting and actuarial specialists to ensure that our basic regulatory objectives of financial solvency, conservative accounting standards and strong consumer protections continue to be met,” said Washington, D.C., Insurance Commissioner Thomas Hampton, who chairs the Working Group.
Following the four-hour public hearing, members of the NAIC Capital and Surplus Working Group considered nine specific proposals. The 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. A document summarizing the proposals adopted is posted on the NAIC website.
The Working Group’s recommendations will next be considered during a joint meeting of the NAIC Executive Committee and Plenary during a conference call at 2 p.m. CT / 3 p.m. ET today, Jan. 29.