Seminar NAIC/ASSAL/SVS Regulation & Supervision of Market Conduct The Importance of Market Oversight © 2014 National Association of Insurance Commissioners

Public Policy reasons for insurance regulation Insurance impacts the public welfare The cost of insurance is a large consumer expenditure Consumers may have limited knowledge Consumer actions alone may not correct inappropriate market practices

Contractual nature of insurance Policies Insurance policies are complicated contracts Insurance policies are aleatory contracts Insurance policies are contracts of adhesion

Goal of market regulation The goal of market regulation is to protect consumers by identifying and correcting insurer operating practices that are in conflict with contract provisions, state laws, rules, regulations, or orders of the Commissioner.

Regulator Activity Before the Sale Company Licensing Producer Licensing Rate and Form Review

Regulator Activity After the Sale Consumer Inquiries and Complaints Market Analysis Investigations Market Conduct Examinations

QUESTIONS/COMMENTS