New Jersey Banking and Insurance Commissioner Steven M. Goldman, testified in Washington on behalf of the National Association of Insurance Commissioners (NAIC) regarding the strength and effectiveness of the state-based system of insurance regulation.
“In addition to successfully protecting consumers, state insurance officials have proven to be adept stewards of a vibrant, competitive insurance marketplace,” Goldman told members of the U.S. Senate Committee on Banking, Housing and Urban Affairs. “The insurance industry in the United States has grown exponentially in recent decades in terms of the amount and variety of insurance products and the number of insurers.”
Goldman said that despite the increasingly global nature of the insurance industry and the diverse number of products it offers, insurance at its core is a local business. State insurance regulators live and work in the communities they serve and this, he said, are uniquely positioned to respond to the needs of insurance consumers.
“State insurance supervision has a long history of aggressive consumer protection, but we’ve also worked hard to create a stable and efficient regulatory environment,” Goldman testified. “The 7,000-plus companies in the United States have seen record profits, while still handling record claims in recent years, and we think the current state-based system has helped foster that competitive environment.”
Goldman said that reforming the system is a constant goal that should start and end in the states. He cited specific, limited areas where he said insurance regulation could benefit from federal assistance –such as producer licensing and surplus lines — and reiterated the NAIC’s willingness to work to achieve uniformity in these areas.
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