A consumer advocate has asked the National Association of Insurance Commissioners, Kansas City, Mo., to answer questions regarding a market conduct analysis project.
The request comes from Birny Birnbaum, executive director of the Center for Economic Justice, Austin, Texas, who sought the information in preparation for a teleconference set for Monday with regulators.
The conduct analysis project includes the collection of data through an annual statement and the placement of that data in a centralized location.
Among regulators, legislators, industry and consumer advocates, the topic is one of intense debate.
Initially, the project was scheduled to be adopted by the NAIC at its summer meeting in early June. That action was then rescheduled for a July 8 conference call which was cancelled. A vote is needed for 2008 data to be processed through the annual statements.
A deadline exists so vendors can prepare the annual statement forms for insurers as it is currently done for the annual financial statements.
Mr. Birnbaum asked regulators:
What was the reason for the cancellation of the July 8, 2008 conference call? [The call was to discuss and possibly advance the project toward full adoption by the NAIC.]
What explanation was given to NAIC members for the cancellation?
Who made the decision to not take action on the D Committee [the NAIC committee that developed the project] proposal and what was the process for that decision?
When was the decision made to not take action on the D Committee proposal?
Why did the NAIC take comments only from industry in a conference call prior to this decision and not seek input from consumer representatives?
Why was this decision made in secret and not after discussion in a public meeting?
What arguments against the MCAS proposal did the NAIC membership find persuasive and what were the reasons for the NAIC's decision not to adopt the D Committee proposal?
What is the NAIC's plan, if any, to centralize the collection of, enhance the data elements in and publish MCAS data?
Sandy Praeger, NAIC President and Kansas Insurance Commissioner, responded to Birnbaum's questions with the following response:
"...As you know, the NAIC has been working on proposals for centralized data collection for many years and has given consumers, industry representatives, legislators and others multiple opportunities to participate in the process with written and oral comments and at several meetings.
"We ultimately decided that because of the importance of the proposal and because of the many legal and technical issues raised related to the proposal by our members that it was best to delay a final decision on the matter.
"The recommendation of the D Committee remains pending before the Executive Committee. The only decision that has been made is to temporarily delay consideration of that proposal. We look forward to the call on Monday and hearing your comments."
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