An insurance company licensing proposal being considered by the Colorado Department of Insurance will make the process more uniform with other states, making it easier for insurers to enter the Colorado market, according to the Alliance of American Insurers.
The regulatory changes being proposed in Regulation 2-1-7 would amend Colorado’s company licensing regulation to accept only the National Association of Insurance Commissioners’ Uniform Certificate of Authority Application (UCAA).
“The Alliance supports the changes to the Colorado regulation to implement the UCAA,” Lenore Marema, vice president of legal and regulatory affairs for the Alliance, a strong advocate for uniformity in company licensing, said. “In our view, the UCAA is intended to replace all of the state-specific requirements currently involved in applying for a company license, thereby creating a more cost-efficient state system. We applaud Colorado for not only implementing the UCAA, but for being one of 16 states that impose no additional state-specific requirements over and above the UCAA. This should result in more insurers seeking to do business in Colorado and more choice for the state’s businesses and citizens.”
According to the AAI, all states now accept the UCAA, but the tedious process of implementing the UCAA and eliminating inconsistent and additional state requirements has begun.
Marema noted that the Alliance believes that this implementation process means that states will eventually conform all of their company licensing requirements to the standard requirements that form the basis of the UCAA. “When implementing the UCAA, states also consider eliminating additional state-specific requirements, which further streamlines the process,” she said.
To this end, Marema submitted comments urging the department to ensure the new regulations were flexible enough to accept future amendments to the UCAA and any supplemental forms that the NAIC has developed to further standardize information that is submitted with the UCAA, such as a model form for service of process.
“It’s a win-win situation for regulators and the industry,” she noted. “Regulators will become accustomed to recognizing and reviewing the same form from all insurers, which should expedite the licensing review process and help them make good decisions. Insurers will be able to file the same form and information in all 50 states.”
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