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 a high level of disclosure for a nonprofit budget. Throughout the development of the NAIC's budget, there are numerous and detailed reviews by all levels of management, the NAIC Officers, the NAIC Executive (EX) Committee, and the Internal Administration (EX1) Subcommittee. As stated in Article IV of the NAIC Bylaws, the budget is released to the public for comment before final consideration and adoption.
The National Association of Insurance Commissioners (NAIC) 2022 budget was approved on Dec. 16, 2021, following months of development by NAIC officers, the NAIC Internal Administration (EX1) Subcommittee, the NAIC Executive (EX) Committee and input from NAIC staff.
“The 2022 budget is structured to maintain support of the NAIC member states as they work to protect consumers in this challenging time,” said Dean Cameron, NAIC President-Elect and Director of the Idaho Department of Insurance. “This responsible budget also reflects our commitment to advance resources and technology to meet the needs of the individual states, the industry, the mission of NAIC and the states’ role in regulating the industry while protecting our citizens.”
The NAIC's 2022 budget includes total revenues (including investment income) of $128.8 million and total expenses of $136.3 million, which represents an 8.2 percent increase and 4.4 percent increase, respectively, from the 2021 budget.
The 2022 budget includes three Fiscal Impact Statements (fiscals):
- Financial Data Repository (FDR) Modernization Pre-Work – FDR is a centralized warehouse storing 10 years of annual and quarterly financial statements filed by 4,500+ insurers. Today, the FDR system is over 20 years old, and the technologies used at that time no longer align with current NAIC development tools, making it difficult and time consuming to support. This fiscal requests professional services to assist staff in laying the groundwork for the full modernization effort. In 2022, changes will be made to migrate reporting to a new reporting tool, leverage other applications' functionality where feasible, document current processes, and analyze requirements for the new system.
- SBS State Implementations 2022 – The NAIC has transitioned 31 licensed states to the new updated SBS platform, known as SOLAR, and interest in utilizing SBS remains strong among many of the remaining states. With several new and pending licenses added to existing commitments, the SBS team’s implementation workload is higher than their capacity resulting in the need to augment staff with external resources.
- 2022 NAIC Staffing Requests – Critical business needs and the current capacity of NAIC staff require six new positions be added in the areas of market regulation, macroprudential surveillance, securities valuation, and cybersecurity.
NAIC 2021 Budget
The NAIC adopted its 2021 Budget during the Joint Meeting of the Executive and Plenary Committees at the 2020 Fall National Meeting. After the inclusion of several fiscals approved during 2021, the current 2021 budget includes total revenues of $119.0 million and total expenses of $130.5 million.
Periodically the Executive (EX) Committee and the Internal Administration (EX1) Subcommittee receive funding requests for projects after the annual budget is approved. Generally, these projects are of an urgent nature to the NAIC's annual agenda or its committee structure that were either not known or not solidified at the time the annual budget was prepared. Their impact is fully described as part of the 2021 projections included within the 2022 budget proposal and the 2021 budget shown above includes these additions.
Media queries should be directed to the NAIC Communications Division at 816-783-8909 or email@example.com.