Date: December 20, 2013
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Wisconsin Office of Commissioner of Insurance Earns NAIC Accreditation
Madison, WIThe Wisconsin Office of Commissioner of Insurance has been honored with accreditation by the National Association of Insurance Commissioners (NAIC). Accreditation demonstrates a state's excellence in monitoring the business of Wisconsin-domiciled insurance companies.
"This honor reflects the hard work of our entire OCI staff including our whole financial team which is led by Becky Easland, the market regulation bureau, and our legal team whose response was coordinated by Richard Wicka," stated Commissioner Nickel. "Accreditation requires planning, organization and a commitment to adhere to sound regulatory principles year round."
Accreditation is used as an assurance that a state is regulating its domestic multistate insurers according to national standards agreed to by the NAIC. For the insurance industry, this means that insurers will not require additional independent exams from the other states in which they do business.
As described by the National Association of Insurance Commissioners:
Accreditation is a certification given to a state insurance department once it has demonstrated it has met and continues to meet an assortment of legal, financial and organizational standards as determined by a committee of its NAIC peers.
The concept of accrediting state insurance departments began in the mid- to late 1980s when several large insurance companies became insolvent. In September 1988, the NAIC began discussing and shaping the Financial Regulation Standards and Accreditation Program and began the formal certification program in June 1990.
The accreditation program relies on state certification by other regulators via peer review, requires risk-focused financial surveillance including on-site examinations, and requires solvency-related model laws, rules and guidelines that have been produced through consensus and collaboration.
Accredited insurance departments are required to undergo a comprehensive review by an independent review team every five years to ensure the departments continue to meet financial solvency oversight standards. These departments are also required to undergo a desk audit annually. The accreditation standards require state insurance departments to have adequate statutory and administrative authority to regulate an insurer's corporate and financial affairs and that they have the necessary resources to carry out that authority.
To become accredited, the state must submit to a full on-site accreditation review. A team of independent consultants review the department's compliance with the standards to develop a recommendation regarding the state's accredited status. To remain accredited, an accreditation review must be performed at least once every five years with interim annual reviews.
Administrator of the Division of Regulation and Enforcement Gina Frank stated, "We have an excellent staff with a great deal of experience. Accreditation reflects the exceptional job they do every day in monitoring our domestic insurers for solvency and compliance."
Created by the Legislature in 1871, Wisconsin's Office of the Commissioner of Insurance (OCI) was vested with broad powers to ensure that the insurance industry responsibly and adequately met the insurance needs of Wisconsin citizens. Today, OCI's mission is to lead the way in informing and protecting the public and responding to its insurance needs.