Regulators Focused on Product Innovation, Emerging Trends

State-based insurance regulation has a 145-year history of effectively and successfully protecting consumers and fostering competitive insurance markets. As the 2016 president of the National Association of Insurance Commissioners, I’m committed to further strengthening our regulatory system.

It’s no small job. We collectively regulate more than $8.3 trillion of insurer assets and $1.8 trillion in premiums. With nearly 12,000 state regulators who form our national system of state-based insurance regulators, I am inspired to provide leadership that draws strength and focus through collaboration with consumers, regulators and stakeholders to maintain security and stability for those we serve.

In 2016, we will leverage the NAIC’s position as the world leader in data collection, validation, aggregation and analysis to keep pace with product innovation and emerging trends. Cybersecurity is today’s Y2K. The insurance industry is an attractive target for hackers because of the extensive amount and types of personal data collected by insurance companies. That’s why it is imperative we continue our focus on cybersecurity enhancements.

Also on the horizon is managing the continuing implementation of health reform as we respond to the needs of consumers and companies. I look forward to continuing to coordinate with Health and Human Services, the Department of Labor, Treasury, Office of Personnel Management, Congress and the White House to help maintain stability as we transition through reform efforts.

Our industry is ever-evolving whether from federal and international changes or industry modifications like price-optimization. We’ll continue to review how the industry writes policies and rates consumers to ensure fair treatment across the board.

Reports show 40 percent of Baby Boomers have no retirement savings. This alarming statistic has prompted me to focus on improving awareness of lifetime income and the importance of affordable, well-regulated financial products for retirement planning. Educated consumers are best positioned to make wise decisions. I’m committed to expanding our outreach to help consumers get smart about their insurance choices and improve their overall financial literacy.

Making sure insurance companies are solvent is one of our key roles. State regulators will continue to review insurer investments, not only to ensure insurers can pay what they promise, but also to help the industry contribute to long term community investments like rebuilding and repairing our nation’s infrastructure.

The NAIC has made great progress in recent years in the continued transition to Principle-Based Reserving in the life insurance area. To date, 39 states representing 71 percent of the required premium have adopted the Standard Valuation Law. The NAIC stands ready with technical resources to assist states through the transition.

At the international level we will continue to lead regulatory discussions with an increased emphasis on setting appropriate standards that reflect U.S. priorities. The NAIC and its members actively engage in international discussions, bilaterally, regionally and through the International Association of Insurance Supervisors (IAIS). We work to ensure U.S. customers are protected and U.S. companies remain competitive here and abroad.

State regulation is successful because we know best how to balance the needs of consumers and the industry. As 2016 NAIC president, I look forward to working to make sure our strong track record not only remains intact, but strives for constant improvement, as we have since 1871.

Topics Cyber Trends USA Legislation InsurTech