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FOR IMMEDIATE RELEASE

NAIC BEGINS 2013 BUDGET
APPROVAL PROCESS

WASHINGTON, D.C. (Oct. 24, 2012) — The National Association of Insurance Commissioners' (NAIC) proposed 2013 budget is now in the approval process, following months of development by NAIC leadership, the Internal Administration Subcommittee, Executive Committee and executive staff.

“We believe this proposed budget reflects our inherent strength and transparency as an organization,” said Jim Donelon, NAIC President-Elect and Louisiana Insurance Commissioner. “The 2013 proposal supports important initiatives that will allow regulators to better protect insurance consumers and ensure a solvent industry. The allocation of NAIC financial resources continues to be guided by our astute investment in these principles to support the state-based system of regulation.”

The NAIC 2013 proposed budget before fiscals and the modeling of structured securities includes total revenues of $80.8 million and total expenses of $78.1 million, which represent a 2.00% and .33% increase, respectively, from the 2012 budget.

There are seven Business and Fiscal Impact Statements (fiscals) proposed in 2013:

1. Health Insurance Exchange Plan Management Data Collection and Communication through SERFF. This is Phase II of a multi-year project to assist states in the establishment of health insurance exchanges, specifically in the area of plan management.   

2. State Based Systems (SBS) Software Enhancement and Technology Compliance Initiative. This is Phase I of a project to begin the migration of SBS services by updating the SBS architecture and tool set.  

3. Financial Staff Exchange Program. This initiative will allow experienced regulators from one state to work with financial regulators from another state for a limited period of time to enhance the solvency expertise of the receiving state.  

4. Actuarial Guidelines XXXVIII (AG 38)/Principle-Based Reserving (PBR) Implementation and Monitoring. This fiscal impact statement supports the implementation and monitoring of activities required by both AG 38 and PBR initiatives.  

5. OPTins Clearinghouse. This project includes the development and implementation of functionality within OPTins to allow Non-admitted Insurance Multi-State Agreement (NIMA) states to have a choice in clearinghouse software.
  
6. Natural Catastrophe Stress Test. This initiative would conduct a financial stress test involving a natural catastrophic event to determine the financial impact on an insurer and its reinsurers as well as on the insurance sector as a whole.

7.   In-House Structured Securities Group. This proposal establishes an in-house structured securities group to support the current modeling of structured securities and would allow the NAIC to expand its analysis to more complex structured securities products.  

Click HERE to view the NAIC's proposed 2013 budget.

A public hearing is tentatively scheduled for November 20, 2012 at 3:00 p.m. Eastern/2:00 p.m. Central/1:00 p.m. Mountain/12:00 p.m. Pacific/10:00 a.m. Hawaii time. If you have any written comments, please provide those to Jim Woody at jwoody@naic.org by Nov. 9, 2012.

Click HERE to view a summary of the comments on the 2013 proposed budget.

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About the NAIC

The National Association of Insurance Commissioners (NAIC) is the U.S. standard-setting and regulatory support organization created and governed by the chief insurance regulators from the 50 states, the District of Columbia and five U.S. territories. Through the NAIC, state insurance regulators establish standards and best practices, conduct peer review, and coordinate their regulatory oversight. NAIC staff supports these efforts and represents the collective views of state regulators domestically and internationally. NAIC members, together with the central resources of the NAIC, form the national system of state-based insurance regulation in the U.S. For more information, visit www.naic.org.

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