The value of a group that is supposed to provide dialogue that industry and regulators can use to take action or at least understand different viewpoints was questioned during the summer meeting of the National Association of Insurance Commissioners, Kansas City, Mo.
“We don’t feel that we are getting any real discussion through this committee and this format,” said Jane Cline, NAIC president and West Virginia insurance commissioner. Cline said that the industry liaison session should be more productive, noting that the consumer ties regulators and industry together. “You ultimate goal is to serve consumers and our ultimate goal is protect consumers,” she noted.
Michael McRaith, Illinois director, said that any work has to be “deliverable and achievable.” For instance, he added, “eliminating rate regulation is not achievable.” And, Susan Voss, NAIC president-elect and Iowa insurance commissioner, said that the NAIC budget is continually raised as a concern and a lot of the issues raised by the committee could be brought up at other NAIC committees.
Deirdre Manna, vice president, industry, regulatory and political affairs, with the Property Casualty Insurers Association of America, Des Plaines, Ill., asserted that industry is really interested in a dialogue with regulators. For instance, she said, that industry was concerned that the insurance commissioner chosen for the non-voting position of the FFOC be one that will continue in his or her post. It is anticipated that with elections in November, a significant number of commissioners may leave with changes in governors.
Ethan Sonnichsen, NAIC director of government relations in Washington, who was delivering a report to the group on changes in Washington, concurred that it was an issue that “is absolutely front and center. We don’t want the FSOC to have an empty seat.” The Financial Stability Oversight Council is comprised of 10 federal financial regulators and five independent nonvoting members which will include one insurance commissioner.
Industry trade groups expressed concern over the filing of data in a centralized NAIC data bank. Confidentiality is a great issue to insurers, said Neil Alldredge, senior vice president of state and regulatory affairs with the National Association of Mutual Insurance Companies, Indianapolis.
The NAIC’s Voss said that because of global changes, state insurance regulators will be required to be more prepared for new global insurance regulatory requirements and from this perspective having data available in a centralized place will be important. Even if data is filed in individual states, it will be shared as part of the effort to regulate companies, she added. And, Voss added, that at some point, a federal entity may want to gather data, whether it is the Federal Insurance Office or the U.S. Treasury.
But NAMIC’s Alldredge said that industry “doesn’t want to find out that there is a confidentiality problem after something has been released.”
Voss countered by asking what the concern is. “Is it the chicken or the egg? Is it that information is being requested or is it a concern over confidentiality?” Alldredge responded that it was the risk to confidentiality with more data and different kinds of data being requested.
Terri Vaughan, Ph.D., NAIC president, asked if there was an objection to the NAIC gathering data other than confidentiality. If there is, she said, “we need to know that.” Dave Snyder, vice president and associate general counsel with the American Insurance Association, Washington, said that the main issue is the NAIC’s capability to protect such information. Vaughan then responded that “then it is important that you tell us what would make you comfortable.”