Global Insurance & Regulatory Bulletin - Third Quarter 2014
At the NAIC Spring National Meeting inMarch 2014, the Group Solvency Issues (E) Working Group (“GSIWG”) was tasked with considering whether amendments should be made to address issues that have arisen since the adoption of the 2010 amendments to the Model Insurance Holding Company System Regulatory Act (the “HCA Model Act”). Specifically, the GSIWG was to consider whether the HCA Model Act should be amended to address the following:
The GSIWG is currently focusing its efforts on the first task, which it is pursuing by drafting a new Section 7A of the HCA Model Act to address “Groupwide Supervision of International Insurance Groups.” The new provision would designate the insurance regulatory official of a single US state to act as the group-wide supervisor of such groups. The proposed changes were exposed for comments in September 2014. The GSIWG subsequently held conference calls on October 3rd and 24th to discuss comments received from the industry.
One of the key concerns from the industry relates to the scope of the group-wide supervisor’s authority. The current draft provides that “[t]he commissioner is authorized to act as the group-wide supervisor for any international insurance group…” The term “international insurance group” is defined as an “insurance group operating internationally that includes an insurer…that is part of an insurance holding company system.” A number of industry representatives expressed the view that the new Section 7A should only apply to “internationally active insurance groups” (“IAIGs”), as defined by the IAIS, so that regulatory attention would be focused on groups “where there is likely to be the most group-wide supervisory activity of consequence.” Although the GSIWG initially rejected this suggestion, during the October 24 call, the GSIWG agreed to leave the issue open for follow up discussion.
A second draft of the revised HCA Model Act is expected prior to the NAIC Fall National Meeting, and the GSIWG plans to have another conference call on November 7 to further discuss the changes and to give the industry another opportunity to comment on the draft before the GSIWG’s November 16 session at the Fall National Meeting.
You have no pages selected. Please select pages to email then resubmit.