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NALC
PO Box 50053
Sarasota,
Florida 34232
Telephone:
941-379-6100
Fax: 941-379-6112
Meet
the NALC's newest members
Save the
Date
2012 Spring Conference
April
18 - 20
Fall Conference Highlights
September
21 - 23, 2011
See highlights of past NALC conferences
NALC Members
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The Value of NALC Membership
The NALC is a growing organization of more than 200 companies. We have accomplished much.
Without the NALC's involvement, the regulatory requirements would be much tougher. But we are small and need your membership. If you agree with what we have been able to do and
what we are trying to accomplish come join us for our next conference. You will see that we know how to have fun as well as get things done.
WHAT THE NALC HAS DONE FOR YOU IN THE PAST:
- Small Company Tax Deduction
- Small Company preferential treatment for the DAC tax
- Phase in for valuation actuary requirements
- Defeated proposed unisex rating requirement (would have prohibited underwriting classifications based on gender)
- Small Company carve out for cash flow testing
WHAT THE NALC IS DOING FOR YOU TODAY (a few selections):
Model Investment Law:
The NALC opposed the "pigeon hole" model investment law.
We did this at the time that the law was supposedly a "done deal."
We advocated the prudent person model alternative.
We were successful in having the "pigeon hole" approach
withdrawn in favor of further consideration in January l, 1994.
We were instrumental in the creation of the Prudent Person Model
Investment Law Working Group.
Model Illustration Regulation:
- We were involved in convincing the NAIC working group to table the Illustration
Act in favor of a Regulation.
- We successfully amended the Illustration Regulation to remove the requirements for annual updated illustrations for all policyholders in favor of sending out Illustrations only when requested by the policyholder.
- We defeated the technical requirement of full expense allocations (which worked seriously against smaller companies and new product lines) in favor of the use of a generally recognized expense table (GRET).
- Were successful in removing the requirements of personal delivery of all life policies.
- Were successful in removing the requirements for full annual reports on term policies that build no non-forfeiture values in favor of the requirement to only report adverse changes.
- Were part of a coalition that successfully persuaded the NAIC working group to remove the provision that limited illustrations to guaranteed rates only.
Small Policy Issues:
- We were successful in implementing the $10,000 illustration carve out for small policies.
- Limited HOME SERVICE WORKING Group white paper to exclude pre need and final expense policies.
Cash flow Testing:
- We were successful in preserving the small company carve out
for cash flow testing.
Replacement Issues:
- Worked to reform draft to benefit consumers and allow members
to compete on the basis of continued product availability.
- Reversed the NAIC Issue of the Cost of Collection.
Successfully Lobbied the SVO:
- To restructure its fees to a tiered structure for tenant credit loans. Originally there was $5,000 fee for all transactions, that fee now is $1,500.
- To continue to publish the rating manual in hard copy as opposed to only CD-ROM.
In General...We have been outspoken in limiting the NAIC budget growth as well as achieving open meetings.
Furthermore, we have
worked with the National Conference of Insurance
Legislators (NCOIL) to limit NAIC expansion.
DIFFERENCES BETWEEN THE NALC AND OTHER MAJOR TRADE ORGANIZATIONS
Small Company Tax Relief:
The NALC was the only insurance trade association to testify before the National Commission on Economic Growth and Tax Reform (Kemp Commission). We are still the only organization willing to talk about federal income taxes.
We have serious Reservations Regarding the SRO (Self Regulatory Organization) Concept.
We believe that the potential litigation exposure significantly outweighs any market benefit. It would seem that companies with tarnished images would be the ones to benefit from this concept. Furthermore, we believe that the cost of complying with this concept has been significantly understated
and will increase dramatically over the time.
We were the first life organization to endorse the NAIC SVO Rating Reforms.
We continue to be active in the Model Investment Law reforms-see the above.
ONGOING ISSUES
- Suitability Issues: New and Hot Topic
- Annuity Illustration Regulation: Work Continues
- Life Illustration: Many remaining Issues of interpretation.
- Codification of Statutory Accounting: The word is that this issue will be used as the vehicle to implement many of the "reforms" that the NAIC favors, whether or not they relate directly to accounting- such as valuation of subsidiaries, electronic data processing equipment among others.
- Continuing Refinement of AVR, IMR, and Risk Based Capital Requirements.
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