The National Association of Insurance Commissioners (NAIC) executive committee and plenary have implemented the US Risk Management and Own Risk and Solvency Assessment Model Act (RMORSA), alongside revisions to the actuarial guideline XXXVIII (AG38).
The NAIC is the US standard-setting and regulatory support organisation that is governed by the chief insurance regulators from the 50 states, the District of Columbia and five US territories.
NAIC hopes that RMORSA, which was passed on 12 September, will assist regulators in assessing and monitoring insurers’ risk management processes.
RMORSA will provide regulators with requirements for maintaining a risk management framework as well as completing an own risk and solvency assessment (ORSA). The model also provides instructions on how to fill out an ORSA summary report with the state insurance commissioner.
NAIC president and Florida insurance commissioner Kevin McCarty said: “The RMORSA Model Act is a key element in our effort to modernise the US approach to the regulation of insurance groups. The model follows our recent work on the NAIC Holding Company Model Act, which I am pleased to say has been adopted in 10 states.”
“We began focusing efforts on AG38 when issues concerning its use came to our attention last year. These revisions represent a resolution that ensures adequate reserves to protect consumers while maintaining a level playing field and competitive markets for companies issuing these products.”
