Market Conduct Regulation - Documents
- 2016 - NCOIL - Market Conduct Surveillance Model Law - 17p
- Adopted by the NCOIL Executive Committee on November 11, 2006.
- Readopted by the NCOIL Executive Committee on November 20, 2011 and November 20, 2016.
- Market Conduct Uniform Examination Outline
- 2019 1014 - NAIC - Guidelines - Voluntary Market Regulation Certification Program, Self-Assessment Guidelines, Checklist Tool and Implementation Plan, Revisions Recommended by Pilot Jurisdictions - 38p
- Draft: 10/14/19
- Implementation Plan adopted Market Regulation and Consumer Affairs (D) Committee – Nov. 30, 2016
- Implementation Plan adopted by the Market Regulation Certification (D) Working Group – Nov. 3, 2016
- Guidelines and Checklist adopted by the Market Regulation and Consumer Affairs (D) Committee – Aug. 27, 2016
- Guidelines and Checklist adopted by the Market Regulation Certification (D) Working Group – July 28, 2016
- https://content.naic.org › inline-files › Redline_When conducting examinations or continuum activities, does the department incorporate applicable Market Regulation Handbook review standards and related ...
- NAIC - Market Regulation Handbook
- 2004 - NAIC - Market Conduct Examiners Handbook - 1582p
- 2004 - IMSA - Market Conduct Standards & the Life Insurance Industry, NOLGHA Annual Meeting, October 26-27, 2004 - 26p
- 1974 - Report - Strengthening the Surveillance System: Final Report, McKinsey & Company, Inc. - 126p
- 1981 - NAIC - Market Conduct and Trade Practices (B1) Subcommittee
- 1981 - NAIC - Market Conduct and Consumer Services Task Forces
- 1981 - NAIC - Background Paper on the Status of the Regulation of Market Conduct in the Insurance Industry, NAIC Market Conduct and Trade Practices (B1) Subcommittee Attachment Five - 17p
- This paper describes the history of the examination process, summarizes the 1974 McKinsey evaluation of the examination system, outlines market conduct developments since the McKinsey study and identifies current market conduct issues.
- 1981-2, NAIC Proceedings - Survey of Industry Experience with Market Conduct Examinations, June 7, 1981, Attachment Four and Four-A (Questionnaire) - p448-
- 1982 - NAIC - Report of the National Association of Insurance Commissioners Special Joint Committee on Examinations - 306p
- 1984 05 - NAIC - Report of the (EX3) Market Conduct Surveillance Task Force Working Group on Consumer Complaint Analysis - 26p
- 1988 - NAIC - Complaint analysis questionnaire: survey conducted by the Subgroup on Market Conduct Data, Complaints and Examinations of the Market Conduct Surveillance (EX3) Task Force
- In 2011, the NAIC introduced a new Market Conduct Annual Statement (MCAS) collection system
- 1995 - JIR / NAIC - Symposium on the Regulation of Life Cost Disclosure and Market Conduct, by Tom Foley and Carolyn Johnson - 48p
- 1998 - SOA - Market Conduct: A New Actuarial Frontier, Society of Actuaries - 20p
- 2000 - NCOIL - Reforming Insurance Regulation: Making the Marketplace More Competitive for Consumers - <WishList>
- 2003 1105 - GOV (House) - Reforming Insurance Regulation: Making the Marketplace More Competitive for Consumers, Richard H. Baker (R-LA) - [PDF-200p, VIDEO-?]
- 2003 09 - GAO - Common Standards and Improved Coordination Needed to Strengthen Market Regulation - 53p
- 2003 0506 - GAO - Insurance Regulation: Preliminary Views on States' Oversight of Insurers' Market Behavior, Statement of Richard J. Hillman, Director, Financial Markets and
Community Investment - gao.gov/products/gao-03-738t --- Full Report: 15p
- 2003 0701 - Report - For NCOIL - The Path to Reform – The Evolution of Market Conduct Surveillance Regulation, by PricewaterhouseCoopers and Georgia State University - 117p
- 2004 - NAIC - Military life insurance sales regulatory response options, Market Regulation & Consumer Affairs (D) Committee, Market Analysis Working Group, HG 8861 N38 - <WishList>
- 2007 11 - Report - For NCOIL - A Study on State Authority: Making a Case for Proper Insurance Oversight, by James W. Schacht Managing Director Navigant Consulting, Inc. and SUNY - 147p
- 2006 (updated) - NAIC - A Reinforced Commitment: Insurance Regulatory Modernization Action Plan - 20p
- 2009 - GAO - Insurance Reciprocity and Uniformity: NAIC and State Regulators Have Made Progress in Producer Licensing, Product Approval, and Market Conduct Regulation, but Challenges Remain - gao.gov/products/gao-09-372 --- Full Report - 57p
- 2012 10 - NAIC / CIPR - CIPR Newsletter - [32p]
- (p19-) - The Market Conduct Analysis Framework - Randy Helder
- NAIC - Market Conduct Surveillance Task Force – NAIC
- NAIC - Market Conduct and Consumer Affairs (EX3) Subcommittee
- 2012 10 - NAIC / CIPR - CIPR Newsletter - 32p
- (p19-) - The Market Conduct Analysis Framework - Randy Helder
- Market Analysis Prioritization Tool (MAPT)
- Because MAPT is a prioritization tool, it does more than just aggregate data for market analysts. Built into the tool is a scoring system.
- complaint index
- total number of complaints against a company, the count of confirmed complaints against a company (a confirmed com-plaint is a complaint that was coded with a disposition con-sidered adverse to the company) and the market share of the company.
- Many analysts refer to MAPT as a “wall of data” because there is so much data provided for so many companies at one time. Nevertheless, MAPT is incapable of identifying, with certainty companies that are misbehaving in the market. Its primary purpose is to prioritize the companies for more in-depth analysis.
- Regulators and NAIC staff developed MAPT with a heavy emphasis on the data available at the NAIC. At that time, much of the data at the NAIC was financial data. Data that could be considered strictly market conduct-related data was limited to complaints, market regulatory actions taken by the states and demographic information. Beginning in 2008, however, the NAIC became the central repository of data gathered through the Market Conduct Annual State-ment (MCAS.) This has greatly increased the scope of data available to market analysts.
- The current form of the MCAS was first collected in 2002 by eight states.
- For the life and annuity lines of business, MCAS collects information on new and replacement activity with a focus on the age of the insured/annuitant and surrender activity, particularly of policies that may incur a surrender charge. There are also claims questions for the life products that address the speed of claim settlement and the percent of claims compromised or denied. Suitability and policyholder service are the focus of the life and annuity MCAS.4
- An analyst can also compare the data to the types of complaints filed against a company. The analyst may find correlations between the complaints and the reported data that substantiates consumer concerns.
- Level 1 - Prior to any examination or audit of a company, an insurance department has to know what they need to focus on during the examination or audit. This requires reviewing a company’s financial statements, the company’s communi-cations with the insurance department and consumers’ communications with the insurance department.
- The analyst accesses this template through the NAIC Market Analysis Review System (MARS).
- "Continuum activity" - Continuum activity is any regulatory response to a market conduct issue. The range of possible responses is referred to as a continuum because of the multitude of possible ways to work with companies in understanding and resolving market conduct concerns. The possible responses can range from a telephone call or letter to audits and examinations and every-thing in between, such as an interview or survey.
- Conclusion
The States regulate insurance entities to help ensure finan-cial solvency and to promote a fair and competitive market-place. Regulators rely on data gathered from a variety of sources to monitor the marketplace. The goal is to spot dis-ruptions as early as possible and resolve them effectively and efficiently. To do so, the data must be organized, ana-lyzed and evaluated. This is the responsibility of financial and market analysts.
- Market analysis does not, and maybe cannot, have the same exactness of financial analysis because of the nature of what it is attempting to analyze: human behavior and the arena in which it takes place—56 NAIC jurisdictions with distinct and occasionally different market conduct regula-tions. Market analysts, however, continue to refine their methodologies in an attempt to be predictive. Regardless of the methodologies, predictive analytics are not possible without adequate data. The only data adequate to the task is transaction-level data. Regulators, particularly market analysts, must continue to push for greater access to trans-action-level data from companies.