A spokesperson for the National Association of Insurance Commissioners said it will respond in due course to a congressman who is seeking a clarification of the NAIC December decision to describe itself as a "standard-setting organization" rather than a trade group.
The NAIC spokesperson was responding to a letter to the NAIC from Rep. Ed Royce (R-Calif.), a senior member of the House Financial Services Committee asking that the NAIC precisely define what the NAIC is and how it is governed.
See also: Rep Royce's letter to the NAIC
Royce said he is asking for the information "as a means of reconciling the NAIC's own inherently inconsistent statements about itself."
At the same time, officials of the American Bankers Insurance Association and a former NAIC commissioner who asked not to be named noted that the change has created "deep concern."
Kevin McKechnie, executive director of the American Bankers Insurance Association, said, NAIC Commissioners "may bristle at the criticism Royce has leveled against them but in my opinion, the NAIC has brought this upon themselves."
"If they want to be a national regulatory body, petition Congress to allow the NAIC staff to fill out the ranks of the Federal Insurance Office,' McKechnie said.
"If they want to be a private organization, the NAIC should fill out the appropriate tax forms and register their lobbyists," McKechnie said.
McKechnie did acknowledge that, "Individually, the commissioners are very smart capable people."
Collectively, however, he said, "the posturing they undertake to enhance the image of their association tarnishes their reputation, in my view, and undermines the credibility they and their staff work so hard to establish. Royce is right to call them out."
The former commissioner, who asked not to be named, added that the Royce letter points out a "serious concern."
