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) 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):

1. 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.
2. 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. 
3. 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. 
4. 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.
5. 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.
6. 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.
7. 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.
8. 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.

Proposed 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 Tuesday, Dec. 10, 2024, at 1:00 p.m. ET/12:00 p.m. CT/11:00 a.m. MT/10:00 a.m. PT. The purpose of this hearing is to address comments and questions received from interested parties. Written comments on the proposed budget are due to Jim Woody at jwoody@naic.org by Nov. 25, 2024.

Participants must pre-register to participate in this hearing. Participants will receive WebEx information upon registration. 

NAIC 2024 Budget

The NAIC adopted its 2024 Budget during the Joint Meeting of the Executive (EX) Committee and Plenary at the 2023 Fall National Meeting.

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 2023 projections included within the 2024 budget proposal and the 2024 budget shown above includes these additions.

The updated 2024 budget includes total revenues (including investment income) of $157.3 million and total expenses of $159.6 million.