NAIC Members Discuss Risk-Based Regime, Innovation Advances at Global Insurance Supervision Conference
National Association of Insurance Commissioners (NAIC) Members provided the U.S. perspective on risk-based capital regime and innovation at the 8th Conference on Global Insurance Supervision, sponsored by the European Insurance and Occupational Pensions Authority (EIOPA), the International Center for Insurance Regulation (ICIR), and the Leibniz Research Institute SAFE (Sustainable Architecture for Finance in Europe) in Frankfurt, Germany.
With a subtitle of, "Insurance Supervision in a World in Transformation," the conference sought to take stock of current insurance supervision policy and provided insights into the future of regulation.
In a panel on the global shift to risk-based supervision, Nebraska Department of Insurance Director Eric Dunning highlighted the work of the NAIC and state insurance supervisors to transition to a risk-based system in the 1990s following a spate of insolvencies in the 1980s. Director Dunning noted that the transition has been successful; however, it is still evolving as new risks emerge. Any newer risks, he added, should be examined thoroughly under solvency rules, especially if there is a chance of new capital requirements.
Speaking on another panel, Massachusetts Division of Insurance First Deputy Commissioner Rachel Davison focused her comments on the state of innovation in the insurance industry and the subsequent risks (and opportunities) for supervisors. Among other points, Deputy Commissioner Davison discussed the movement of supervisors to increase capacity and sophistication on technical issues, as well as the use of technology, and she stressed the ongoing work of the NAIC to ensure that supervisors collaborate and communicate on emerging issues.
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.