Market Conduct On NCOIL Agenda

Market conduct reform debate will highlight the summer meeting of the National Conference of Insurance Legislators in Boston this weekend.

The state lawmakers will consider adopting the model they originally approved in February of 2004, but then revised in the form of a market conduct model surveillance act jointly sponsored with the National Association of Insurance Commissioners.

Such joint sponsorship was intended to improve its appeal to state legislatures. But no state has even introduced the model, while Texas has adopted a market conduct reform act closer to the original NCOIL document.

Property-casualty industry representatives have said the joint document provided too much leeway to regulators in mandating costly market conduct exams and did not do enough to encourage states to recognize another state's market conduct oversight.

“The issue is critical to fending off federal regulation,” said NCOIL executive director Susan Nolan. “In general, the NCOIL model would establish models for collecting marketplace data and would set forth a continuum of market conduct actions for consideration prior to undertaking targeted market conduct exams.”

Also on the agenda will be a look at various proposals in Washington to provide more federal oversight of insurance regulation.