HONOLULU, Hawaii -- The National Association of Insurance Commissioners (NAIC) surpassed a long-standing goal on December 6 when it announced that a substantial majority of state insurance departments have achieved its accreditation standards for solvency regulation.
Certificates of accreditation were presented to the heads of 10 state insurance departments have at the opening session of the NAIC's Winter National Meeting. That brings the total number of accredited states to 32 since the program's inception three years ago.
"From the earliest days of the program, we pledged that a substantial majority of the states would be accredited by the end of 1993," said NAIC President Steven T. Foster. "After much hard work, we have met that challenge. The certification of these 10 states today means we have attained our goal. The facts speak loud and clear. This program works."
The states accredited on December 6 were Delaware, Georgia, Louisiana, Massachusetts, Oklahoma. Oregon, South Dakota. Washington, West Virginia, and Wyoming.
Insurers licensed in the 32 accredited states account for 97.4 percent of all premiums written nationwide. That figure for life companies is 98.5 percent: for property/casualty insurers it represents 96 percent, Foster reported.
"The premium volume of companies licensed in accredited states truly demonstrates the broad-based success of the accreditation program," Foster continued.
"Since the program began a short three years ago, all 50 states and the District of Columbia have adopted laws and regulations designed to strengthen their regulatory abilities and bring them into compliance with the tough accreditation standards," he said. "At the same time, insurance department resources and personnel have continued to grow."
The accreditation program, according to Foster, works like this: When a state insurance department seeks to become certified, it is reviewed by an independent team of auditors selected by the NAIC. They assure not only that the state complies with the laws and regulations contained in the NAIC accreditation standards, but with regulatory and organizational practices and procedures which are also part of the standards. The team reports its findings to the NAIC Committee on Financial Regulation Standards and Accreditation. That committee decides whether a state qualifies for accreditation under the NAIC standards.
The process is ongoing, Foster adds. He said accredited states are subject to an annual...