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NALC
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NEWS RELEASE:NALC Responds to NAIC Initiatives on Small Life Insurance PoliciesMay 26, 2000, Chicago, Illinois - The National Association of Insurance Commissioners (NAIC) held a Plenary conference call yesterday, May 25, 2000, to discuss issues surrounding the sale of Industrial Life Insurance policies. The discussion was prompted by the investigation of Industrial Life Insurers in Florida and a recent article that appeared in the Wall Street Journal concerning the ongoing investigation of insurers that sold these policies in Florida. The article detailed the use of rates based on race and other “problems,” such as premium-to-benefit ratios (Premiums exceeding death benefits) and consumers purchasing numerous policies. We have been advised that during the conference call, Plenary determined that the following actions should be taken:
We have attempted to access the NAIC Web Site (www.naic.org) to confirm each specific item. Unfortunately, according to the error message we received, the Web Site access was “Denied.” We will again attempt to confirm the specific action items. We have been advised that the NAIC leadership will be drafting a Resolution for all 55 commissioners to sign in Orlando. However, we do not know whether reports that the NAIC will convene a multi-state investigation are correct. The NALC agrees that the use of race to determine insurance rates, even though approved at one time by state insurance regulators, must not be used for the underwriting of coverage, collection of premiums on existing policies or any other reason. However, if the report concerning the other action items is correct, we believe that it is critical from the standpoint of solvency and the protection of the Consumer, that additional investigation of the actuarial impact upon the Consumer and insurance companies must be the subject of open discussion with actuarial experts before combining policies or forcing them to become “Paid-up.” Additional review must also be undertaken before policies are combined for the same solvency-related reasons. The NALC applauds the efforts of state insurance regulators for their efforts to tackle tough issues. We look forward to working with the NAIC and individual regulators and offer the resources of the NALC in the actuarial review of these issues of concern. * * * * * * * The National Alliance of Life Companies (NALC) is a national trade organization with more than 250 life insurance company members. The NALC promotes fair and effective regulation of the life and health insurance industry, while allowing for a reasonable return to policyholders and shareholders. To arrange for an interview regarding any of these issues or with anyone quoted in the releases, contact Dawn Bergsma, Meeting Planner/Office Manager: 941-379-6100.
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of Life Companies
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The NALC held its 2008
Spring Conference April 2-5, at the Grand Hotel Marriott, Point
Clear, Alabama.