NAIC Budget

The NAIC’s annual budget process is an open and deliberative process among the NAIC members and members of the insurance industry. NAIC budgets have historically offered more disclosure than any nonprofit budget. Throughout the development of the NAIC’s budget there are numerous and rigorous reviews by all levels of NAIC management, the NAIC Officers, the Internal Administration (EX1) Subcommittee, and the NAIC Executive Committee. As stated in Article IV of the NAIC Bylaws, the budget is released to the public for comment before final consideration and adoption at the NAIC Winter National Meeting.

NAIC 2009 Proposed Budget

The NAIC's proposed 2009 budget began the approval process at the Fall National Meeting, following months of development by NAIC leadership, the Internal Administration (EX1) Subcommittee and executive staff.

“We have prepared a strong and transparent budget for 2009, one demonstrating our focus to serve members in their protection of consumers and ensuring strict solvency of the insurance industry. The proposal includes significant investment in membership participation in NAIC meetings and education and training programs,” said NAIC President-Elect and Hew Hampshire Insurance Commissioner Roger Sevigny. “Once again, the proposed budget will be published in great detail, allowing all interested persons to understand the allocation of NAIC financial resources.”

The 2009 budget proposes revenues and expenses of $73.1 million and $70.5 million, respectively, forecasting revenue growth of 7.1%. The NAIC's expense budget is projected to grow by 6.0%, largely supported by the NAIC's continued investment in membership services and proposal supporting the membership's strategic initiatives.

New initiatives include:

• Continued investment in the State Producer Licensing Reengineering project, representing consulting resources and one full-time employee.
• Allocation of NAIC resources to the Market Conduct Annual Statement proposal to (1) prepare and support the existing MCAS process (updating it to collect 2008 data filed in 2009), (2) enable the collection of data submitted by states to the NAIC and (3) automate the aggregation of data for limited analysis and the creation of national ratios and averages by the NAIC, which is still subject to discussion by the NAIC membership in the coming months.
• A proof of concept proposal to evaluate the scope, timeline and potential costs of leveraging the Florida Office of Insurance Regulation's Public Hurricane Risk and Loss Model in order to build a national multi-peril model administered by the NAIC for use by states potentially affected by natural catastrophes.
• The addition of one full-time employee to support of the NAIC's goals and priorities in the work of the International Association of Insurance Supervisors (IAIS).

NAIC 2008 Budget

The Internal Administration (EX1) Subcommittee held a public hearing on the 2008 budget proposal on November 6, 2007. The Subcommittee adopted the budget immediately following the hearing. The Executive (EX) Committee adopted the 2008 budget at the NAIC 2007 Winter National Meeting.

Should you have any questions about the NAIC budget, please feel free to contact Brady Kelley, NAIC Chief Financial and Business Strategy Officer at (816) 783-8011 or Carol Hartley, NAIC Sr. Controller at (816) 783-8038.