A Summary of the IIPRC Background and Development
NAIC – The Future of Insurance Regulation
In 2000, members of the NAIC unanimously adopted The Statement of Intent: The Future of Insurance Regulation as a blueprint for significant and substantial regulatory reforms to modernize state insurance regulation. The NAIC formed the Speed-to-Market Working Group to address regulatory efficiency issues as insurers facing direct competition from financial institutions and securities firms sought a more effective filing and review process. The Working Group recommended the development of a system featuring a single point of filing and review; development of national standards for insurance products; and a more efficient state-based procedure for processing and filing.
In early 2001, state insurance regulators created CARFRA (Coordinated Advertising, Rate and Form Review Authority), a voluntary pilot program designed to allow regulators to set national product standards and create a single point of filing for designated insurance products, such as life insurance and annuities. CARFRA made progress in developing product standards, but was not successful because there was a general consensus that in order to overcome the state deviations in filing requirements, state laws and regulations would need to be changed. Because of these uncertainties, companies were not comfortable filing with CARFRA.
In February 2002, NAIC members discussed options for achieving true uniform product standards. State insurance regulators knew they needed a way to facilitate interstate cooperation and develop national uniform standards that would be applicable in multiple states. An interstate compact seemed an ideal way of addressing this issue.
The NAIC formed a working group in 2002 to develop compact legislation. The NAIC adopted the initial Interstate Insurance Compact Model in December 2002 with the understanding that it would be a starting point for discussion with state legislators, attorneys general, governors, and other stakeholders. The NAIC worked closely with the National Conference of State Legislatures (NCSL), the National Conference of Insurance Legislators (NCOIL), the National Association of Attorneys General (NAAG), and other state officials to further refine and enhance the Compact Model legislation. In July 2003, the NAIC adopted eight amendments to the legislation which serves as the current version of the model legislation. NCSL and NCOIL have both endorsed the Compact – the first time that this has happened.
Interstate Insurance Product Regulation Commission (IIPRC) – The Future is Now
The Compact was created when the first two states, Colorado and Utah, enacted the Compact legislation. The Interstate Insurance Product Regulation Commission (IIPRC) was brought into existence upon meeting the threshold requirements of 26 states or 40% of premium volume nationwide; both of which were met in May 2006.
The IIPRC held its Inaugural Meeting in June 2006 in Washington, DC, forming its interim Management Committee and adopting the System for Electronic Rate and Form Filing (SERFF) as its electronic filing platform. By September 2006, the IIPRC adopted its Bylaws and Rulemaking Rule after comprehensive discussions with legislative, consumer and industry representatives.
The IIPRC held its first Annual Meeting in November 2006 whereby its permanent Management Committee was established and Officers elected from Pennsylvania, West Virginia and Minnesota. At this Meeting, the IIPRC announced the hiring of an Executive Director to oversee the start-up and day-to-day operations of the IIPRC.
Within six (6) months of its creation, the IIPRC adopted its first Uniform Standards in December 2006. The IIPRC reached its goal and started receiving and reviewing product filings by mid-2007. In the Fall of 2007, the IIPRC instituted Filing Fees to finance the operations of the IIPRC. By the start of 2008, the IIPRC had brought on an experienced regulatory team to provide daily support for the product review process. Also at the beginning of 2008, IIPRC Annual Registration Fees were inaugurated to further finance the IIPRC. Throughout 2008, the IIPRC Office has worked with the Members and interested parties in developing Uniform Standards through extensive public notice and participation processes. At the end of 2008, the IIPRC has in effect 46 Uniform Standards with more to be in effect early in 2009. As the IIPRC moves into its third year, work is continuing to adopt more uniform product standards, specifically in the Group Life Products, and to enhance the procedures to receive product filings on behalf of the IIPRC Member States.
Today, the IIPRC has 43 Members representing approximately two-thirds of the premium volume. Our Member States are: Alabama, Alaska, Arkansas, Colorado, Georgia, Hawaii, Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Montana, Nebraska, Nevada, New Hampshire, New Jersey, New Mexico, North Carolina, Ohio, Oklahoma, Oregon, Pennsylvania, Puerto Rico, Rhode Island, South Carolina, Tennessee, Texas, Utah, Vermont, Virginia, Washington, West Virginia, Wisconsin, and Wyoming.
Additional IIPRC History