October 16, 2012
The NAIC adopted a Solvency Modernization Initiative in 2008. The ALTA Accounting Committee met late last month in California and heard a presentation from Al Bottalico of the California Department of Insurance on the Initiative. A major part of the Initiative is the Own Risk and Solvency Assessment designed for insurers to perform their own risk assessment and use in regulatory filings. In addition, the NAIC is looking at developing risk focused financial exam guidelines and studying the possibility of risk based capital requirements for title insurers. It is noteworthy how much attention is being focused on solvency assessment by the NAIC across all lines of insurance.