The NAIC began the Market Conduct Annual Statement (MCAS) in 2002 with the goal of collecting uniform market conduct related data. The MCAS provides market regulators with information not otherwise available for their market analysis initiatives. It promotes uniform analysis by applying consistent measurements and comparisons between companies.
To limit the impact to insurers, the NAIC decided to gradually add new states. Five new states ( Alabama, California, Montana, Rhode Island and Washington) will be collecting 2008 information in 2009.
At the 2008 Fall National Meeting, the NAIC Executive Committee adopted a proposal to find the best possible way to collect MCAS data according to a two-part plan:
- Short-Term: The first part part of the plan provides for the transfer of MCAS data collected in 2009 by the 29 participating states to the NAIC for storage, aggregation and analysis in the existing Access Database format. The proposal also provides direction for NAIC staff to analyze the aggregated data and identify strengths and weaknesses in the data currently being collected.
- Long-Term: The second part of the plan focuses on the long-term commitment of the NAIC to centralize collection of market conduct data. Although centralized data collection has been contemplated by the NAIC Market Regulation and Consumer Affairs (D) Committee since at least December 2007, the key difference from prior proposals is that the NAIC did not move forward with the Committee's recommendation to collect 2010 market data via the NAIC Annual Statement.
The decisions of whether the collected information should be treated as confidential as well as the method to collect the information have not been decided. The decisions will include input from all interested parties.
NAIC members will consider the project's Business and Fiscal Impact Statement, which formally provides for the allocation of resources to implement the short-term transition proposal in 2009, as part of the formal 2009 budget package to be voted on in December.
Database Information
Unlike financial statements, the Life/Annuity and Property/Casualty Market Conduct Annual Statements are not actual forms, but Microsoft Access databases. The MCAS databases are compatible with Microsoft Access 2000 and Microsoft Access XP Service Pack 1. An Access Runtime version of each database is available for companies that do not have Microsoft Access 2000. A company may obtain the Runtime version by sending their U. S. Postal mailing address to the NAIC Staff Support listed on this page. Links to the MCAS databases are located under Committee Documents on the right.
MCAS Call Letters
Participating states request MCAS information by a call letter sent to each company. Sent annually in November, the addressee of any given call letter is the first contact person designated on the jurat page of the company’s Financial Annual Statement for the prior year.
Market Conduct Company Contact
Every company required to participate in the MCAS project must provide a contact person responsible for the overall project. Companies must submit the required contact information on the jurat page of the Financial Annual Statement.
Company Report Cards
To assist participating companies in gaining a better understanding of where they fit in the insurance marketplace, each company will receive a “report card” from each state where they filed the MCAS. The report card includes information about the company ratios in relation to average industry ratios and enables companies to use this information in identifying areas where opportunities may exist for the company to improve its performance. Participating states may provide the report card by one or more methods. The participating state may send hard-copy report cards to the designated company contacts for MCAS, e-mail report card information, or post state-wide industry averages on their website so companies can simply compare the state-wide averages to the information found in their own database.
Market Conduct Examinations
It is important to note that even if a company falls outside of the norm, it does not mean a market conduct examination will be called on the company. Alternatively, participation in the MCAS is no guarantee that a market conduct examination will not occur.
Market Conduct Annual Statement Procedures
The adopted procedures establish the policies and procedures with respect to proposed amendments to the Market Conduct Annual Statement blank and instructions. Additionally, timeframes were established for the dissemination of call letters and report cards.
Key MCAS Dates
- October, 2008 – Companies update contact information with NAIC; states update contact and submission information with NAIC
- November 15, 2008 – NAIC emails data calls to company contacts
- December 31, 2008 – Companies update contact information with NAIC.
- April 30, 2009 – P&C MCAS submissions due to states
- June 30, 2009 – L&A MCAS submissions due to states
- October 1, 2009 – P&C report cards mailed/emailed
- November 1, 2009 – L&A report cards mailed/emailed
NAIC Involvement
The Ohio Department of Insurance has transitioned MCAS technical and administrative support to NAIC staff as of March 1, 2008.
Questions
NAIC Staff can:
- provide copies of the Access Runtime version of the Market Conduct Annual Statement; and
- answer questions emailed to mcas@naic.org related to the business activities of the Market Conduct Annual Statement (D).
Questions regarding the following must be forwarded to the contact person for the appropriate state:
- extend filing deadlines;
- waive filing requirements;
- assist with data errors or warnings; or
- provide clarification regarding data definitions (other than those listed on this webpage).
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