National Association of Insurance Commissioners Meeting

National Association of Insurance Commissioners Meeting

August 2008
The NAIC's Summer National Meeting was held on May 31 - June 2 in San Francisco, California. The NAIC's Fall National Meeting will be held on September 22 - 24 in Washington, DC. If there are any particular sessions at any NAIC National Meeting that you would like to have monitored, please contact us. Consumer Guides Working Group The Working Group received an update and reviewed the 4th Draft of its new brochure "A Consumers Guide to Homeowners Insurance" which is being developed for first time home buyers or those purchasing insurance. The Working Group desires to create a "quick to read" brochure which is easy to understand and includes direction on where to get additional information, including the NAIC website and a reference to each state's website, should a state wish to adopt the Brochure. The Brochure would cover such issues as "Why You Need Insurance," "What the Policy Covers," "How the Premium is Determined," and "Personal Liability Coverage and Medical Payments Coverage." Creation of separate documents is proposed for renters, mobile homes, condominiums and automobile policies. Surplus Lines Task Force The Surplus Lines Task Force received a status report on the Nonadmitted and Reinsurance Reform Act (NRRA - S. 929 of 2007 and H.R. 1065 of 2007). If enacted, NRRA would preempt certain aspects of state regulation of multi-state surplus lines policy placement and premium taxation. Commissioner Donelon observed that the surplus lines industry believes the regulation of this aspect of the insurance industry needs to be modernized, simplified and made more uniform. The Task Force discussed the establishment of a facility or clearing house through which all multi-state surplus lines risks would be filed. The Task Force also discussed alternative ways for states to comply with the requirements which would be mandated by the NRRA. The NRRA raises both surplus lines licensing and eligibility issues, but the primary request from interested parties has been for regulators to address the taxation issue. If the bill becomes law, there will be a strong incentive for states to enter into some kind of revenue sharing agreement. Antifraud Task Force The Antifraud Task Force considered the "Guidelines for State Insurance Regulators to the Violent Crime Control and Law Enforcement Act of 1994: 18 USC 1033 and 1034" which was originally produced by the Antifraud Task Force and published by the NAIC. There is a growing concern regarding various interpretations and handling of Section 1033 waiver requests and related issues by the separate states. A revision of the Guidelines will hopefully begin a dialog amongst states with the goal of a more uniform approach to granting Section 1033 waivers. The Task Force was advised of a case to be filed in the Eastern District of Oklahoma against an insurance company owner previously convicted of a felony involving dishonesty. The case is expected to be precedent-setting for prosecutions of Section 1033 violation and various members of the Task Force will monitor its progress. The Working Group was also advised that the Coalition Against Insurance Fraud ("CAIF") is working with the Michigan SIU Association and the National Insurance Crime Bureau ("NICB") to host an annual insurance fraud week in Michigan during the second week of October. Producer Licensing Working Group The Working Group received an update on the adoption of revisions to the initial and renewal applications for individuals and business entities. Approximately 104 pages of recommended changes to the applications were submitted for discussion and were reviewed by a small group of regulators. A decision was made to eliminate the reinstatement application, as most states only utilize their own initial or renewal applications forms, not the reinstatement form. The new applications will be available January 1, 2009. The Working Group also recently adopted the Independent Adjustor Licensing Guidelines which will now be sent to the Market Regulation and Consumer Affairs (D) Committee for adoption. The Working Group has discussed in previous meetings using a separate application for Independent Adjustors and that application should be available soon. National Treatment and Coordination Working Group The Working Group reviewed and adopted a new Redomestication Grid to be posted on the Uniform Certificate of Authority Application (UCAA) website. The purpose of the Grid is to provide specific information from each state for foreign insurance companies seeking to redomesticate. As with other UCAA Grids currently available on the website, it is the responsibility of the domestic regulator to update the chart in a timely fashion. The Working Group also adopted changes to the NAIC Biographical Affidavit Form (UCAA Form 11) related to maiden name and name changes to maintain confidentiality and to the Best Practices Handbook related to the Affidavit Form in order to maintain the personal information contained therein in a confidential manner. The Working Group was advised that while some states can keep the entire Affidavit Form confidential, other states keep only the supplement form or a portion thereof, confidential. The Working Group faces continuing obstacles in ensuring uniform confidential treatment, due to disparate state statutes which generally relate to the nature of the information, rather than the portion of the Affidavit Form on which the information is disclosed.
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