Insurance Center

System to Make Available a Method for Analyzing Key Market Performance Data

A proposal that will enhance efforts to develop a uniform system for collecting insurance companies’ market-related data has been adopted by state insurance regulators.

The system is known as the Market Conduct Annual Statement (MCAS), a name given to it by the National Association of Insurance Commissioners (NAIC) at their Fall National Meeting in National Harbor, Md., and regulators are going forward with it as a major initiative.
Sandy Praeger, NAIC President and Kansas Commissioner, says that the MCAS database is used to centralize storage of the states’ market conduct data. According to her, the system acts to provide state regulators with better data aggregation and analysis of the data results. She says that this represents a similar approach as that being taken with other reporting initiatives that have worked well in the past.

Using the NAIC as a centralized point for the aggregation of data relating to insurance companies’ financial data, in the past the states have collected information on post-catastrophe and long-term care insurance claims. The procedure being used is being based on the ongoing state authority to share information with the NAIC and with other states.

In accordance with a two-part plan for moving the project forward, it is already known that the calendar year of 2009 will act as a transition period in which regulators will be working to find the best possible way to collect data:

• Short-Term: During the initial stages of the plan, provision is being made for the transfer of MCAS data which are to be calculated in 2009 by the 29 participating states, into the NAIC for storage, analysis and aggregation within the existing Access Database format. Included in the proposal are directions enabling NAIC staff to analyze the aggregated data, to identify their strengths and weaknesses and to generally analyze the data currently being collected.

• Long-Term: The second stage of the plan concentrates on the long-term commitment by the NAIC to centralize the collection and dissemination of market conduct data. It is true however, that the centralization of data collection has been under consideration on the part of the NAIC Market Regulation and Consumer Affairs (D) Committee since beginning in December 2007. The key difference here when compared with the prior proposals is that in the past the NAIC did not proceed with the Committee’s proposal to collect 2010 market data via the NAIC Annual Statement.

The NAIC will take into consideration the project’s Business and Fiscal Impact Statement, which provides in a formal manner for the allocation of resources to bring about the short-term transition proposal in 2009, as part of the formal 2009 budget package which is to be voted upon in December.