The National Association of Insurance Commissioners' Accreditation Program Continues to Exhibit Fundamental Problems
T-GGD-93-26: Published: Jun 9, 1993. Publicly Released: Jun 9, 1993.
- Full Report:
GAO discussed the National Association of Insurance Commissioners' (NAIC) efforts to improve and standardize insurance solvency regulation. GAO noted that: (1) states have attempted to improve the quality of insurance regulation by adopting the financial regulation standards set forth in the NAIC accreditation program; (2) NAIC and its review teams have interpreted the financial regulatory standards permissively and accredited states with weak regulatory authorities and practices; (3) many state insurance departments are still working to adopt the original financial standards and may not be able to keep pace with the evolving NAIC standards; (4) specific work procedures and guidelines for planning, supervising, and conducting examinations of insurance companies' financial conditions do not exist; (5) NAIC standards have encouraged some states to make improvements in insurance regulation; and (6) NAIC willingness to improve its accreditation process, will better its chances at achieving effective solvency regulation under the current state system.