FOR IMMEDIATE RELEASE

REGULATORS TESTIFY ON MULTI-STATE APPROACH TO GROUP SUPERVISION
Financial Assessment of Insurers Aided by Unique Regulatory Tools

WASHINGTON, D.C. (March 18, 2010) — The checks and balances of a multi-state approach to group supervision and financial assessment is a key strength of the state regulatory system, the National Association of Insurance Commissioners (NAIC) told Congress today.

Testifying today before the House Subcommittee on Capital Markets, Insurance and Government Sponsored Enterprises, state regulators referenced key tools, practices and model laws used by states to assess the financial condition of insurance groups. Today’s testimony highlighted cross-border supervision and cooperation, NAIC coordination activities and peer review provided by multiple jurisdictions.

“Through the NAIC, regulators have created three core solvency surveillance mechanisms – reporting, analysis and examination – to ensure that obligations to policyholders and other parties are met both today and in the future,” said Sean Dilweg, Wisconsin Insurance Commissioner. “In our system of state regulation, it is imperative that regulators around the country have access to these sophisticated tools, particularly when assessing large, multi-state insurers.”

Dilweg discussed tools such as the NAIC Financial Regulation Standards and Accreditation Program and Financial Analysis Working Group to ensure that regulators are effectively maximizing resources to protect consumers and the solvency of their regulated entities.

“Every state has extensive authority, based on the NAIC Insurance Holding Company System Regulatory Act, to effectively supervise insurance groups,” said Ann M. Frohman, Nebraska Insurance Director. “Our system of multiple jurisdictions and peer review for insurer groups contributes to a “race to the top” approach.”

Both Dilweg and Frohman also spoke about ongoing state coordination with federal agencies, such as the Office of Thrift Supervision and the Federal Reserve.   

Click HERE to view Commissioner Dilweg’s full testimony.
Click HERE to view Director Frohman’s full testimony.
 

About the NAIC

Formed in 1871, the National Association of Insurance Commissioners (NAIC) is a voluntary organization of the chief insurance regulatory officials of the 50 states, the District of Columbia and five U.S. territories. The NAIC has three offices: Executive Office, Washington, D.C.; Central Office, Kansas City, Mo.; and Securities Valuation Office, New York City. The NAIC serves the needs of consumers and the industry, with an overriding objective of supporting state insurance regulators as they protect consumers and maintain the financial stability of the insurance marketplace. For more information, visit www.naic.org.

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