NAIC Initiates 2025 Budget Approval Process
The National Association of Insurance Commissioners (NAIC) has released its proposed 2025 budget following months of development by NAIC officers, the NAIC Internal Administration (EX1) Subcommittee, and the NAIC Executive (EX) Committee, as well as input from NAIC’s Chief Executive Officer and other executive staff.
“Ensuring the financial stability and sustainability of our regulatory framework is vital for protecting consumers and fostering innovation,” said Jon Godfread, NAIC President-Elect and North Dakota Insurance Commissioner. “As we navigate the complexities of evolving regulations and advancements in technology, the NAIC’s 2025 budget reflects our commitment to state-based regulation by strategically allocating resources to support robust oversight, continue to enhance our technological infrastructure, and provide an avenue for responsive, adaptable regulations. Funding for these efforts is essential to maintaining the integrity of our insurance markets and ensuring that state regulators have the modern tools they need to effectively serve their communities, uphold the public trust, and protect consumers.”
The NAIC's proposed 2025 budget includes total revenues (including investment income) of $167.0 million and total expenses of $173.6 million, which represents a 6.2% increase in revenues and an 8.8% increase in expenses from the 2024 budget.
The proposed 2025 budget includes eight fiscal impact statements (fiscals):
- System for Electronic Rates & Forms Filing Modernization (SERFF) – 2025 Transition Stages
This fiscal is to continue funding a multi-year initiative to improve the SERFF platform. In 2025, life and property/casualty users will move into the platform. This request includes the addition of two headcount.
- VISION Support Team
This fiscal includes the addition of five technical staff to support NAIC’s Capital Markets and Investment Analysis Office’s immediate and long-term development needs.
- Enterprise Data Asset Management – Phase IV
This fiscal continues the development of the enterprise data platform. This phase will build upon previous phases which delivered a cloud-based platform populated with financial and regulatory data. This fiscal includes the addition of one headcount for development and ongoing system maintenance.
- Monitoring Collateralized Loan Obligations (CLOs)
This fiscal is responding to a Valuation of Securities (E) Task Force initiative to maintain credit assessments for various insurer-owned securities, specifically CLOs. This fiscal includes the addition of one headcount for analytical support.
- Long-Term Care Insurance Experience Study
This fiscal is to sponsor an upcoming long-term care insurance study with the Society of Actuaries. NAIC members will receive training as well as the study results from assisting with the expense of this study.
- Financial Data Repository (FDR) – Modernization Proof-of-Concept
This fiscal is to secure funding for a proof-of-concept that will explore a third-party vendor solution to house and manage FDR’s technical infrastructure. This will demonstrate the vendor’s capabilities and potential benefits from utilizing their technology which will modernize the FDR platform.
- Member Customer Relationship Management
This fiscal requests funding for a customer relationship management (CRM) system to improve member engagement and service quality. This will dramatically improve NAIC’s interactions with its members and data sharing by centralizing certain information and communications.
- Operational Staffing
Recognizing the need for additional operational support, this fiscal includes the addition of eight headcount in a variety of areas including technology, regulatory services, and operations.
The proposed 2025 NAIC budget can be found on the NAIC’s About Budget page.
NAIC 2025 Budget Briefing with Interested Parties
A budget briefing is scheduled for Tuesday, Nov. 5, 2024, at 3:00 p.m. ET/2:00 p.m. CT/1:00 p.m. MT/12:00 p.m. PT. The purpose of this briefing is to provide an overview of the proposed budget in advance of the Nov. 25, 2024, comment deadline.
Participants must pre-register to participate in this briefing. Participants will receive WebEx information upon registration.
Public Hearing
A public hearing is scheduled for Dec. 10, 2024. Written comments on the proposed budget are due to Jim Woody at jwoody@naic.org by Nov. 25, 2024. Full details for the public hearing will be posted on the NAIC website as soon as they are available.
About the National Association of Insurance Commissioners
As part of our state-based system of insurance regulation in the United States, the National Association of Insurance Commissioners (NAIC) provides expertise, data, and analysis for insurance commissioners to effectively regulate the industry and protect consumers. The U.S. standard-setting organization is governed by the chief insurance regulators from the 50 states, the District of Columbia and five U.S. territories. Through the NAIC, state insurance regulators establish standards and best practices, conduct peer reviews, and coordinate regulatory oversight. NAIC staff supports these efforts and represents the collective views of state regulators domestically and internationally.