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BOSTON -- State insurance regulators are involved in a variety of regulatory and educational efforts to help policyholders and insurers exterminate the "millennium bug."
With 18 months until the problem is triggered, several subgroups of the National Assn. of Insurance Commissioners discussed ways to assess and avert the impact of inadequately programmed computer chips failing to appropriately reflect the year 2000.
"We see it as a critically important issue," NAIC President Glenn Pomeroy of North Dakota said during the association's meeting in Boston last month.
During a special meeting, a Massachusetts Insurance Division regulator expressed his department's concerns that business groups have not had enough opportunity to evaluate year 2000 policy exclusions proposed by the Insurance Services Office Inc.
Business groups should be solicited for comment, perhaps through a public hearing, urged Steve D'Amato, director of the State Rating Bureau for the Massachusetts Insurance Division.
The Massachusetts division probably will hold an informational hearing of its own after soliciting comment from business groups, said its commissioner, Linda Ruthardt. "It may be that those ISO proposals are totally appropriate, but we don't know and don't think that the response of regulators should be knee jerk," she said.
Other states concerned about the issue include Alaska, Maine, Missouri and Texas, according to Mr. D'Amato.
However, the fact that about 44 state insurance departments already have approved the ISO filing generally indicates it is accepted among the majority of states.
Meanwhile, the NAIC's new Year 2000 Working Group is continuing its work to encourage states to survey their domestic insurers about their preparedness and that of their vendors.
In addition, the National Assn. of Independent Insurers proposed to the regulators' group a 10-month moratorium on new NAIC regulations becoming effective shortly before and after the Year 2000, to allow insurers to focus on the critical, one-time adjustment. The NAIC is considering the proposal.
In other action at the meeting, insurance commissioners:
* Gave interim approval during a meeting of the Commercial Lines-Property/Casualty Committee to a white paper on commercial lines deregulation. The proposed Regulatory Re-engineering of Commercial Lines Insurance will next be considered by the NAIC's Executive Committee before a full NAIC votes on it, perhaps as early as the fall meeting.
* Heard public comment on the Interstate Receivership Commission's proposed uniform law, which the three-state commission expects to approve by a Sept. 9 deadline.
The proposed law is designed to increase information to policyholders, claimants and other interested parties. In addition, it will give them an opportunity to provide meaningful input into a receivership's business plan, said Peter Gallanis, Special Deputy Receiver of the Illinois Insurance Department.
Comments will be accepted through July and should be sent to Mr. Gallanis at 222 Merchandise Mart Plaza, Suite 1450, Chicago, Ill. 60654.
The commission consists of representatives of Illinois, Michigan and Nebraska.
* Awarded second-round accreditation status to the South Dakota Insurance Department.
The NAIC's accreditation program requires accredited state insurance departments to undergo an extensive review every five years to ensure they still meet baseline standards. There are now 49 accredited insurance departments, and 14 of those have received their second-round accreditations.
* Gave interim approval during a meeting of the Financial Condition Subcommittee to the Risk-based Capital for Health Organizations Model Act, which establishes the regulatory authority for applying a proposed risk-based capital formula to regulated managed care organizations.
The full NAIC membership is expected to vote on the model at its fall quarterly meeting in September.
* Announced that 47 states and the District of Columbia have signed a memorandum of intent to establish an international commission charged with resolving the issue of insurance claims of Holocaust survivors.
In addition, members of the NAIC's International Holocaust Commission Task Force reported on a recent trip to Europe to meet with several European insurance regulators about the issue.
* Joined with the National Conference of State Legislatures in sending a letter to Congress opposing "HealthMarts," a cross between a purchasing co-operative and a multiple-employer welfare arrangement that federal lawmakers are considering as part of health reforms (BI, June 29).