Weatherford Leaves NAIC

Catherine Weatherford, executive vice president and CEO of the National Association of Insurance Commissioners, is leaving her post, the NAIC confirmed.

The organization did not state what circumstances led to her abrupt departure. Andrew Beal, the NAIC's deputy executive vice president, has been named interim executive vice president and CEO while a search for a successor is undertaken.

Efforts to reach Ms. Weatherford were not immediately successful.

A number of regulatory and industry sources suggested that some NAIC members were unhappy with her management as well as the direction the organization was taking. And those issues were raised when contract negotiations began, these sources said. All sources asked not to be quoted on the record.

The NAIC had recently announced that it would move senior staff to Washington as the issue of federal oversight becomes more prominent. Multiple sources said that Ms. Weatherford had sought more salary as part of that move and as part of a change in her responsibilities.

In January 2008 the NAIC released pay information for top executives that listed Ms. Weatherford's salary as $370,000. Chris Evangel, managing director of the Securities Valuation Office, was the next highest paid at $307,878, followed by Mr. Beal at $262,500.

But under Ms. Weatherford's charge, the NAIC has grown as witnessed by its 2008 $68.3 million budget.

Another source said that a “small group of commissioners had banded together” because of unhappiness over how the organization, based in Kansas City, Mo., was handling federal efforts to create a national agent licensing system, the National Association of Registered Agents and Brokers.

Also mentioned was the issue of a bill introduced by Rep. Paul Kanjorski, D-Pa., that includes a proposal to create an Office of Insurance Information. The source said the displeasure was over the questions “who's running the shop, and are you really representing your members.”

Another source concurred. “Over the years, there has been a shift in the organization from membership driven to staff driven. The perception was that if you go to the Hill, you don't represent state interests but the interests of the NAIC.”

Another issue that angered some commissioners, according to sources, was a letter that went out to the National Governors Association and the National Association of Attorneys General, both in Washington, expressing support for the OII bill.

The source said some commissioners maintained that there was no legal basis for the NAIC to send out a letter to a commissioner's governor without that commissioner's knowledge.

Yet another source noted that Ms. Weatherford did not get along with the CEOs of the National Insurance Producer Registry or the Interstate Insurance Product Regulation Commission because she was perceived to be usurping authority from these entities.

And, this source said, there was “unrest internally” from some of the NAIC staff.

But, in spite of these assertions by people familiar with the matter, several insurance commissioners contacted by National Underwriter held out praise for Ms. Weatherford.

“I have known Cathy longer than most commissioners. I am one of the few commissioners that was around when she came to work at the NAIC,” said Georgia Commissioner John Oxendine. He described her as being “responsive” when he made requests of the NAIC.

“Cathy was very successful in her efforts to advance state-based consumer protections,” said Maine Superintendent Mila Kofman.

Ms. Weatherford assumed her duties in July 1996. Prior to her post at NAIC, she was Oklahoma insurance commissioner from 1991 through 1996.

In a statement released this afternoon, the NAIC said Ms. Weatherford is “anticipated” to continue to serve the association as a consultant through the 2008 Fall National meeting.

“I am proud of the accomplishments NAIC members have made during my tenure at the NAIC–especially in areas that have resulted in stronger consumer protections, regulatory modernization and more effective financial regulatory oversight,” Ms. Weatherford is quoted as saying.

She said she is ready for a change and would “pursue another professional career” adding “my decision to leave the NAIC was not an easy one.”

Arthur D. Postal contributed to this story.

This story was updated at 2:07 p.m.