Filings Made Easy for Life, Health and Licensing

1
(No Transcript)
2
Filings Made Easy for Life, Health and Licensing
Market Conduct
3
Topics of Discussion

• Organizational Structure
• Market Conduct Examinations
• Market Conduct Surveillance Act
• Market Analysis
• NAIC Support
• Q A

4
Organization Charts Financial Program
5
Organization Charts Market Conduct
David Moskowitz, CFE Assistant Chief
Examiner Market Conduct
Steve Carter, CFE, AIE, FLMI, AIRC Senior Market
Conduct Examiner
John Sedgwick, CPA, CIE, AFE Market Conduct
Examiner - Austin
Royston Lanning, CPA, AFE Market Analyst
John Lim, CPA, CIE Market Conduct Examiner -
Houston
Shemeddra Thomas, AIE Market Conduct Examiner -
Dallas
Jacqueline Butler Market Conduct Examiner - San
Antonio
Karen Wright Market Conduct Examiner - Austin
Laura Yanez Market Conduct Examiner - San Antonio
6
Examinations - Types of Entities

• Insurance Companies
• Premium Finance Companies
• Third Party Administrators (TPAs)
• Local Recording Agents

7
Examinations - Number of Exams

• Fiscal Year 2008 (as of 5/31/08) 15
• Plus 3 currently being examined
• Fiscal Year 2007 - 17
• Fiscal Year 2006 - 14
• Fiscal Year 2005 - 19
• Fiscal Year 2004 - 16

8
Examinations - Triggers

• Market Analysis
• Financial Examinations
• Referrals From Other Divisions
• Consumer Protection
• Agents Licensing
• Life/Health
• Commissioner
• Current Events

9
Examinations - Issues

• Stranger Owned Life Insurance (STOLI) Policies
• Premium Financing
• Race-Based Pricing
• Clean Claims
• Long Term Care

10
Market Conduct Surveillance Act

• Texas Insurance Code Chapter 751
• Established framework for market conduct actions
• Market Analysis
• Market Conduct Actions
• State Coordination
• Impact on Examinations
• Authority to schedule a triennial exam for
  domestic insurers regardless of cause
• Authority to target problem areas of ALL insurers
  FOR cause regardless of where they are domiciled.

11
Market Conduct Surveillance Act (continued)

• Examination Timelines
• Must provide 60 days notice (unless
  extraordinary)
• Pre-exam conference 30 days prior
• Draft report due 60 days after exit conference
• Insurers written comments due 30 days after
  Draft
• Final report due 30 days after written comments
• Insurer has 30 days to accept or request hearing
• NO MORE 1ST OR 2ND LEVEL APPEALS

12
Market Analysis

• Market Analysis is designed to
• Provide tools for each state to review its entire
  market
• Identify companies operating in each states
  market that are potentially harming consumers
• Assist in narrowing the scope of any regulatory
  action that a state determines it must use

13
Market Analysis (continued)

• Steps in Market Analysis include
• Baseline Analysis
• Level 1 Analysis
• Level 2 Analysis
• Continuum of Regulatory Responses

14
Market Analysis (continued)

• Baseline Analysis
• A systematic process by which basic parameters
  are used to evaluate the entire marketplace in
  order to identify those companies that require
  more detailed and thorough analysis
• Baseline Analysis Tools include
• Market Analysis Company Prioritization Tool
  (MAPT)
• PCCI Justified Complaint Index
• Companies ranked by score comprised of
• MAPT Score
• PCCI Score
• Market Share Position

15
Market Analysis (continued)

• Level 1 Analysis
• Market Analysis Review System
• Areas of Review Include
• Management and Operations
• Financial Performance Measures
• Complaints
• Regulatory Actions
• Examinations
• Recommended Next Step
• Level 2 Analysis is scheduled
• We will proceed within the Continuum of
  regulatory response
• No further analysis is necessary

16
Market Analysis (continued)

• Level 2 Analysis
• Core Areas of Review
• Consumer Complaints
• Continuum Activity
• Examinations
• Interdepartmental Communications
• Market Analysis
• Regulatory Actions
• Optional Areas of Review
• Recommended Next Step
• We will proceed within the Continuum of
  regulatory response
• No further analysis is necessary

17
Market Analysis (continued)

• Continuum of Regulatory Responses
• Includes
• Officebased information gathering
• Targeted information gathering
• Correspondence with company
• Interrogatories
• Desk audit
• Company self-audit
• Targeted examination
• Comprehensive Examination
• Enforcement action

18
Market Analysis (continued)

• Lines of Business
• Credit Life
• Group Accident Health
• Group Life Annuities
• Individual Accident Health
• Individual Life Annuities
• Long Term Care
• Medicare Supplement

19
Market Analysis (continued)

• TDI Market Analysis Activity
• 40 to 50 Level 1 Analyses performed each of the
  past two years
• On target to complete 50 Level 1 Analyses in
  the current year
• 51 of current year Level 1 Analyses have
  resulted in recommendation of Level 2 Analysis
  (35) or Continuum response (16)

20
NAIC Support

• Market Regulation Handbook
• Market Analysis Working Group (MAWG)
• Market Analysis Review System (MARS)
• Market Analysis Prioritization Tool (MAPT)
• Market Initiative Tracking System (MITS)
• Market Regulation Bulletin Board

21

• QUESTIONS?