The NAIC held its Winter National Meeting in Grapevine, TX, December 4-8, 2008. The Meeting included discussion of the following topics:
- Annuity Suitability. The Suitability of Annuity Sales (A) Working Group took comments on a “Discussion Draft” (dated 11/14/08) of a revised Annuity Disclosure Model Regulation. After input and questions from Group members, industry and consumer representatives made presentations focusing on both broad and technical issues raised by the Draft (see the following article). The Group reached consensus that the Draft merited a full day workshop among regulators and interested parties.
- Annuity Illustrations and Disclosures. In May 2008, Iowa requested that insurers file annuity illustrations. Based on its review of hundreds of illustrations, Iowa summarized its findings to the Annuity Disclosure (A) Working Group and highlighted examples of good and problematic illustrations. The Group then discussed possibly amending the Annuity Disclosure Model Regulation to regulate illustrations. The Working Group held conference calls in February to consider this as well as disclosure of annuity guarantee fund protections.
- Reinsurance Regulatory Modernization Framework Proposal. The NAIC plenary formally approved the Proposal, which, among other things, provides for relaxed collateral requirements under specified conditions and the establishment of an NAIC Reinsurance Supervision Review Department. Following the Plenary’s approval, New York and Florida announced they will withdraw and/or revise their own similar initiatives.
- Securities Lending Practices. At the Life Insurance & Annuities (A) Committee meeting, concern was raised about life insurers’ securities lending practices, including accounting transparency and solvency risks, especially in stressed markets. It was also reported that these issues were being discussed in regulator-toregulator meetings and by the Credit Default Swap (EX) Working Group.