Nickel, who is also Wisconsin’s Commissioner of Insurance, told Carrier Management that the National Association of Insurance Commissioners is focusing much of its energies on understanding the issues at play in order to make sure both consumer and the industry benefit.
“There is so much going on right now in the innovator space and the disruptor space with the new technologies, new software, new analytics – all moving towards finding their own way into the insurance marketplace,” Nickel said.
In an attempt to better understand how technology and innovation is affecting the insurance marketplace, Nickel noted that the NAIC has an executive level committee task force focused on the issue.
“We are all hands on deck, focusing on making sure we understand all that’s going on with innovation and technology,” Nickel said.
He added that NAIC members “have been working very closely with the tech community as well as existing insurance companies that are finding new opportunities for technology that they can use to better communicate with their customers, and try to better offer insurance products, and security and peace of mind to their customers.”
Thoughts on a Covered Agreement
During the interview, which took place in mid-May, Nickel also touched on federal and state regulation.
One of the biggest issues facing regulators is talks between U.S. and EU representatives about a covered insurance/reinsurance agreement, which would be an agreement between the United States and one or more foreign governments, authorities or regulatory bodies regarding insurance/reinsurance rules. As of July 14, the U.S. Department of the Treasury and the Office of the U.S. Trade Representative announced their intent to sign such an agreement, one that it said would affirm America’s state-based system of insurance regulation, give U.S. insurers more growth opportunities and “provide regulatory certainty.
The Trump Administration said it would issue a U.S. policy statement on implementation in the coming weeks.
Nickel spoke to Carrier Management in May after the NAIC’s Annual International Insurance Forum. He said that regulators and industry representatives there had developed some consensus at the event that “there probably won’t ever be a strict, perfect global standard for insurance regulation.”
At the same time, Nickel said he hoped regulatory jurisdictions would be recognized in this process for their own ways of determining solvency or other national standards for market conduct.
“There should be a way,” he added, “for multiple jurisdictions across the global to work together to achieve the goal of good solvency regulation, lower compliance costs and consumer protections.”
Does the FIO Have a Future?
The Federal Insurance Office, established within the U.S. Department of the Treasury under former President Barack Obama’s administration, took part in the covered agreement process. The FIO’s future remains in doubt under President Donald Trump’s administration, and Nickel said its functions could live on within Treasury.
“There are roles that are currently existing in Treasury that should continue,” Nickel said. “We believe that there should be more insurance conversations embedded in and intermingled with all financial services discussions occurring at Treasury.”
At the same time, should the Trump Administration decide to keep the FIO, Nickel said NAIC would like to see the office “help engage with us on other issues of insurance that arise throughout the federal government.”
*Editor’s Note: Nickel is scheduled to speak on Tuesday, July 18 at the Insurance Journal/Demotech, Inc. Super Regional P/C Insurer Conference 2017 in Lake Geneva, WI.