FOR IMMEDIATE RELEASE
NAIC Initiates 2017 Budget
WASHINGTON, D.C. (Oct. 19, 2016) —The National Association of Insurance Commissioners (NAIC) is releasing its proposed 2017 budget, following months of development by NAIC officers, the NAIC Internal Administration (EX1) Subcommittee, the NAIC Executive (EX) Committee and NAIC staff.
"Over the past two years the NAIC has made substantial investments in technology initiatives, including cybersecurity, which is consistent with the organization's goal of providing high-quality services to state insurance regulators, consumers and insurance industry users," said Ted Nickel, NAIC President-Elect and Wisconsin Insurance Commissioner. "In 2017 the NAIC will finish implementing a number of enhancements born out of these recent investments. This budget prudently manages expenses while providing reasonable funding to continue the organization's support of state regulators in their goal to protect consumers and ensure a solvent insurance industry."
The NAIC's proposed 2017 budget includes total revenues (including investment income) of $101.9 million and total expenses of $102.1 million, which represents a 4.4 percent increase and 0.4 percent decrease respectively, from the 2016 budget.
The proposed 2017 budget includes six Fiscal Impact Statements (fiscals):
- Regulatory Data Collection – Phase II – This fiscal requests funding to establish a flexible, responsive data collection framework at the NAIC. The first initiative for which the framework will be used is Principle-Based Reserving (PBR).
- System for Electronic Rate and Form Filing (SERFF) Integration Expansion – Phase II – This request expands SERFF Integration Services (SIS) to allow industry customers to retrieve additional data and attachments from SERFF and to send updates back to SERFF, making two-way integration available. This initiative will improve speed to market for insurance products as the automation provided will reduce errors, eliminate duplicate data entry and help insurers get timely products into the hands of insurance consumers.
- Online Content Management System (CMS) – Traffic on the NAIC's website has grown from 40,000 unique users in 2006 to 2 million in 2016. This fiscal requests funding for a tool and the implementation of processes and procedures to streamline the creation, approval, security and deployment of content as well as improve navigation, accessibility and usability of content.
- Information Technology Infrastructure Library (ITIL) Adoption – Phase II – This is the second phase of an initiative to enhance existing technology with a new tool to improve change and incident management processes. Centralized tracking of changes to the NAIC technology environment benefits cybersecurity efforts and strengthens NAIC's position for audits and certifications. Enhancements in this area will help prevent system outages/issues or provide swifter resolution to system outages/issues when they occur.
- Job Scheduler – This fiscal requests funding for the purchase of an off-the-shelf job scheduler tool, which will improve availability, reliability and performance of NAIC applications and promote greater uniformity across internally developed systems.
- Recalibration of Database Filing Fee Structure – A simplified database filing fee structure is proposed in this fiscal. Approximately 70 percent of filers will experience no change or a reduction in fees paid compared to the current structure. The recalibration will reduce the disparity of fees while more equitably distributing funding of major investments in important insurance regulatory initiatives, NAIC systems and technology infrastructure, which benefit state insurance regulators, consumers and the insurance industry.
A fee calculator is available for insurance companies interested in determining their 2017 database filing fee using the proposed formulaic approach.
The NAIC's proposed 2017 budget.
*The proposed budget is over 200 pages and is set up for duplex printing.
A public hearing will be scheduled in early December. Please provide any written comments on the proposed budget to Jim Woody at firstname.lastname@example.org by Nov. 17, 2016. Details for this call will be posted on the NAIC website once the conference call date and time has been finalized (no later than late October).