More insurers under state "permitted practices" rules arerequesting relief from requirements concerning their capitalsurplus.

Approximately 20 companies have applied to the Ohio insurancedepartment for relief in response to bulletins issued on Feb. 3,according to Carly Glick, a department spokesperson. Letters willbe sent to the companies next week in response to the requests, sheadded.

The requests follow a filing by Hartford Financial, Harford,Conn., to the Connecticut insurance department for relief amountingto $987 million. The relief was granted by Connecticut InsuranceCommissioner Tom Sullivan.

The use of "permitted practices" rules in states to offercompanies capital and surplus relief may force companies to ask forrelief in order to remain competitive with companies that haveapplied for the dispensation, according to Birny Birnbaum,executive director of the Center for Economic Justice, Austin,Texas.

Mr. Birnbaum and Robert Hunter, an insurance advocate for theConsumer Federation of America, Washington, are arguing that anycapital and surplus relief proposals should be vetted and fullyprocessed by the National Association of Insurance Commissioners,Kansas City, Mo.

Not only does the use of "permitted practices" in individualstates create a competitive situation among companies, but it alsocreates possible conflict among states with different views on theuse of how these practices should be used to grant relief, Mr.Birnbaum added.

Mr. Hunter and Mr. Birnbaum sent a letter today to stateinsurance commissioners requesting a March 1 publication by theNAIC of the total number of requests for permitted practicesrelated to capital and reserve relief for reporting year 2009.

They sought information broken out by state, by type ofinsurance product and type of request (where type of request isspecific, such as request for change in accounting for deferred taxasset). The names of companies making the requests would not berequested.

The request follows correspondence that Mr. Birnbaum sent toCommissioner Sullivan for all correspondence regarding his grantingof capital relief to Hartford Financial.

In a Thursday e-mail, Mr. Birnbaum said the correspondenceregarding the request can hardly be considered confidential when itwas publicly discussed by Hartford in its 10K filing with theSecurities and Exchange Commission. "An insurer cannot claimprivilege when it has waived that privilege by releasing theinformation to the public," he noted.

He added, "The requests for permitted practices are notfinancial analyses, examination work papers, operating or financialcondition prepared on or on behalf of or for the use of theinsurance commissioner."

And, Mr. Birnbaum said, statutory authority calls for therelease of such information if it is in the public interest, whichhe maintains it is.

The NAIC did not immediately respond to a request for comment.Other states are starting to weigh in on whether they will offercapital relief. In addition to Ohio, Iowa has indicated that itwill allow capital relief as described in their respectivebulletins. The Ohio department said it can't release the names ofthe companies or whether they will be given relief until after theletters go out.

Iowa insurance department spokesman Tom Alger said the agencyhas received several requests from its domestics.

Lauren Sammerson, a spokesperson for Lincoln National Corp.,said Indiana, the company state of domicile, has granted the firmpermission to follow certain regulatory permitted practices foryear-end 2008 statutory accounting purposes.

Illinois, Maine and New York said that if companies individuallyare in need of help, they will entertain ways to offer capitalrelief but not as a blanket rule.

Pennsylvania has not received a company request as there are noprovisions under state insurance laws for less than minimal capitaland surplus, according to Katy Gresh, a department spokesperson. Ingeneral, permitted practices are not allowed, she added.