The National Association of Insurance Commissioners’ (NAIC) new risk-based capital (RBC) task force will convene for the first time at the NAIC’s spring meeting, where discussions will also focus on data calls and asset adequacy testing, according to a report from AM Best.
The NAIC’s spring meeting serves as a key forum for outlining priorities for the coming year, said Carrie Haughawout, senior vice president of life insurance and regulatory policy at the American Council of Life Insurers (ACLI).
“It’s going to be a lot of conversations between stakeholders and regulators,” Haughawout said. “Our goal for this meeting is just to continue to promote that transparent dialogue between regulators and industry.”
Haughawout also said the ACLI is particularly focused on discussions related to the new RBC task force and asset adequacy testing. The task force is central to the NAIC’s efforts to update RBC formulas, which is one of its top priorities for 2025, according to the report.
According to the NAIC, the task force will assess when new risks should be incorporated into RBC calculations and determine the data needed for setting related factors. The group will also examine approaches for addressing emerging risks not currently covered by the framework, review statistical safety levels, and establish guidelines for recalibrating formulas to maintain their effectiveness.
The ACLI has supported a transparent, data-driven approach to RBC processes, Haughawout said, adding that the task force is well-positioned to advance this effort. She also noted that the task force’s first organization call had more than 300 participants, reflecting significant interest in its work.
The group’s future direction remains uncertain. Depending on its approach, some insurers may need to adjust their investment portfolios, said Hilary Segura, department vice president and counsel for state government relations at the American Property Casualty Insurance Association.
"It’s part of the NAIC’s years-long efforts to take a holistic review of the framework for insurer investments," Segura said, adding that the initial focus will likely be on life insurers’ investments.
Beyond the new task force, the ACLI is monitoring discussions on asset adequacy testing guidelines, which have undergone significant revision over the past year, Haughawout said.
"The guidelines have changed pretty significantly from when they were first introduced to where we are today, which is a position to finalize a disclosure-only approach," she said.
The NAIC will also consider updates to its public adjuster model law, which Segura described as a positive step. "There's significant need to bring clarity and openness to the interaction between consumers and public adjusters," she said.
